Price increases are the main source of the increase in spending on oral anticancer drugs in the Medicare Part D prescription drug program, according to new research.
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“Annualized spending on the same oral anticancer drugs more than doubled in a 5-year period,” Kira Seiger from Harvard Medical School, Boston, and colleagues wrote in a research letter published online in JAMA Oncology.
“Use increased substantially, likely owing to expanded drug indications, increased Medicare Part D enrollment, and declining cancer mortality yielding longer treatment courses,” the authors continued. “However, increased spending was predominantly driven (56%) by rising drug costs, which is reflective of pharmaceutical pricing strategies.”
Increased use of these drugs accounted for 44% of the annualized spending on the 56 oral anticancer drugs in this study.
Researchers found that from 2007 through 2013, “anticancer drugs prices increased 5% above inflation annually, plus 10% per subsequent indication approved. Results of this study demonstrated a continued rise from 2013 through 2017 with a compound annual growth rate of 13% above inflation for drug cost per beneficiary.”
Ms. Seiger and colleagues noted that, from 2013 through 2017, more than $41.4 billion was spent on the 56 oral anticancer drugs examined for the study. These drugs carried an average out-of-pocket cost of $551, accounting for $2.1 billion of the amount spent on these drugs.
“High drug prices on market entry are often attributed to research and development expenses, though research and development may not explain the subsequent increases in drug costs demonstrated in this study,” the researchers stated.
They recommended policy makers consider capping price increases at a set percentage above inflation, “especially given that rising use reflects increased need for these therapies.”
The study was sponsored in part by the department of dermatology at Brigham and Women’s Hospital, Boston. Three of the five authors reported received fees from pharmaceutical manufacturers, and one reported serving as chair for the National Comprehensive Cancer Network.
SOURCE: Kira Seiger et al. JAMA Oncology. doi: 10.1001/jamaoncol.2019.4906.