Global spending on cancer drugs rose 10.3% from 2013 to reach $100 billion last year as a host of new expensive breakthrough medications hit the market and patents on existing drugs limited price competition from generics, according to a report.
Annual spending on cancer drugs grew by a compound annual growth rate of 6.5% globally over the past five years, according to a new analysis released Tuesday by the IMS Institute for Healthcare Informatics. The growth was driven largely by a rise in spending on targeted cancer therapies, which grew at a rate of 14% over the past five years and account for nearly half of total spending on oncology medications.
The U.S. accounted for 42% of all drug spending in 2014. European countries increased their share of the global drug spend to nearly 15% in 2014 compared with 13.3% in 2010. Drugmakers launched 45 new cancer therapies between 2010 and 2014, with 10 coming out in 2014 alone.
New therapies have helped increase the number of cancer patients who are living longer. An estimated two-thirds of cancer patients are living at least five years after they're diagnosed, compared with 50% in 1990.
“The increased prevalence of most cancers, earlier treatment initiation, new medicines and improved outcomes are all contributing to the greater demand for oncology therapeutics around the world,” Murray Aitken, executive director of the IMS Institute, said in a statement. “Innovative therapeutic classes, combination therapies and the use of biomarkers will change the landscape over the next several years, holding out the promise of substantial improvements in survival with lower toxicity for cancer patients.”
Costs related to cancer treatments have increased 39% over the past 10 years, according to the report. Consolidation of independent oncology practices into hospital systems, meanwhile, means patients are paying higher out-of-pocket costs.
Spending on cancer drugs is likely to continue rising. Demand for oncology services has been fueled by an influx of newly insured patients as a result of the Affordable Care Act, as well as a boom in the elderly population, which is projected to more than double by 2050.
A report released in March by the American Society of Clinical Oncology projected the number of cancer cases in the U.S. would increase 45% by 2030.