More and More Expensive Drugs Boost Prescription Costs

May 9, 2001 ( - Americans spent nearly 19% more on prescription drugs last year on top of a similar increase the prior 12 months, according to a new study.

However, only a small group of drugs drove up spending, and 23 products made up half the increase according to the National Institute for Health Care Management Foundation, a health research group.

Drug spending on outpatients rose to $131.9 billion in 2000 from $111.1 billion in 1999, an increase researchers attributed in part to a trend among doctors to write more prescriptions and a marked shift to more expensive new drugs.

Trend Setters

Another trend contributor was more aggressive marketing by drug companies to doctors and patients as well as better health insurance coverage that made doctors more likely to prescribe more expensive drugs, and an increase in the number of prescription drugs available, especially for chronic conditions.

Another factor in the spending rise was the market dominance of more costly brand-name drugs versus their cheaper, generic equivalents. For example, while generic drugs accounted for about 40% of all prescriptions, they amounted to just 9% of total prescription drug sales, down from 12.2% five years ago.

Sales Leaders

Top sellers included:

  • Vioxx, an arthritis drug made by Merck
  • Lipitor, a cholesterol reducer sold by Pfizer
  • Prevacid, an ulcer drug sold by Tap Pharmaceuticals

Anti-depressants remained the top-selling category of prescription drugs in 2000, accounting for $10.4 billion in retail sales, up 21% from 1999. Those patients without health care coverage often paid the highest price for drugs since they lacked any bargaining clout to gain discounts, the researchers said.

More detail on the survey is at .