Drug prices are expected to increase 3.81% next year, propelled by expensive cell and gene therapies and glucagon-like peptide agonists.
The estimate from Vizient, a group purchasing organization, tops the company's 2024 drug cost growth projection of 3.42%. Vizient uses recent provider purchasing data to forecast what hospitals and health systems might pay for drugs after discounts and rebates.
Related: Healthcare costs to grow 8% next year
Here are five takeaways from the report.
1. More gene and cell therapies coming online
Nearly 300 gene and cell therapies are in clinical trials, some of which may cost more than $1 million for a single dose.
Those that are approved by the Food and Drug Administration range in cost from $250,000 to $4.25 million per dose, including drugs that treat sickle cell anemia, Duchenne muscular dystrophy and spinal muscular atrophy.
2. Demand for GLP-1s still increasing
Providers have seen their spending on glucagon-like peptide-1 agonists, known as GLP-1s, increase significantly. For instance, spending on semaglutide, which is marketed under the brand name Wegovy, rose 77% over the past year, according to Vizient data.
Manufacturers of GLP-1s like Ozempic and Wegovy have been able to gain FDA approval for a broader range of treatments, including reducing the risk of major heart issues in overweight or obese adults. While many patients are turning to the new drugs to lose weight, most insurers only cover them to treat diabetes.
"Demand for GLP-1s will continue to increase as indications broaden," said Carina Dolan, associate vice president of pharmacoeconomics and market insights at Vizient.
About 1 in 8 Americans have used GLP-1s, which typically carry a list price of more than $11,000 a year.
3. Humira still tops drug spending
AbbVie’s top-selling rheumatoid arthritis drug Humira still tops providers’ list in total drug spending, despite biosimilars that have come online.
Nine Humira biosimilars, which are less expensive copies of biologic drugs, have launched since January 2023. However, Humira still accounts for 98% of adalimumab purchases for Vizient pharmacy program participants, based on Vizient data.
4. Drug shortages are more prevalent
Drug shortages are reaching record numbers, driving up pharmaceutical costs as providers search for and potentially pay more for alternative treatments.
Active national drug shortages reached 323 at the end of 2023, up from 305 in 2022, according to data from the American Society of Health-System Pharmacists and the University of Utah Drug Information Service.
5. Cancer drugs grow exponentially
Chimeric antigen receptor T-cell therapy, known as CAR-T drugs, has grown exponentially since hitting the market in 2017.
Six CAR-T treatments are available for several types of lymphoma, myeloma and chronic lymphocytic leukemia. Five of those drugs saw prices rise 9% since November 2023, while one increased 7%, Vizient data show. All six cost more than $455,000 per treatment.
However, less-expensive competitors to CAR-T, known as bispecific T-cell engagers, are in demand. There are nine FDA-approved bispecific T-cell engager drugs.
