The annual report, which analyses drug spending trends for 11 publicly funded plans, showed a $1-billion spike in prescription drug spending during the 2015-2016 period. That brought total documented expenditures up to $11.3 billion, 79.7% of which was covered by the plans. The rest was paid by beneficiaries either out-of-pocket or through private drug plans.
Average prescription costs for both non-seniors and seniors grew more rapidly compared to previous years. In the case of seniors, the rise in costs reversed a years-long trend of declines. The highest per-senior expenditures were observed for Health Canada’s Non-Insured Health Benefits drug plan ($2,342) and Ontario’s plan ($2,163), while the lowest were reported in BC ($908) and Prince Edward Island ($1,015).
The prescription costs tallied for 2016-2016 were spread over 285 million prescriptions dispensed to more than 9 million active beneficiaries. The increased expenditure was composed of rising drug costs (74.7%), dispensing costs (21.8%), and reported markups (3.5%).
Drug costs rose by 12.4% (almost $900 million) to reach $8.4 billion. The increase was mainly driven by an upward push from higher-cost patented drugs with anti-hepatitis C antivirals accounting for more than half of the increase. The major high-cost treatments mentioned were ophthalmologics, diabetes drugs, immunosuppressants, antithrombotic agents and antivirals. Counterbalancing effects from generic pricing and substitution pulled down costs — but not by enough to offset the cost-increasing factors.
Dispensing costs grew by 3.8% ($90.7 million). The average dispensing fee per prescription hardly changed compared to previous years (-0.2%), and prescription-size changes due to provincial policy adjustments made a modest contribution to dispensing-cost growth. Dispensing costs for patented drugs overall went down by 5.1%, although the costs for high-priced patented drugs (those costing more than $10,000 per year) rose by 20.4%. Dispensing costs for multi-source generics and single-source non-patented drugs increased by 11.3%, reflecting a generic substitution trend.
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The latest CompassRx report of public drug plan expenditures shows that Canadian plans are getting squeezed by rising drug costs.