The Growth of Specialty Pharmacy: Current trends and future opportunities

April 29, 2014

Innovative specialty drugs are providing important cures and treatments, with new therapies expected in the near future. However, annual costs for certain drugs may reach $30,000 and in some cases exceed $100,000 per patient. Already these drugs comprise over a quarter of total drug spending in the United States and spending is growing at double-digit rates even as the growth rate for traditional pharmaceuticals has slowed.

  • A recently released report offers new data from UnitedHealth Group on current trends in specialty pharmacy; examines opportunities and challenges presented by new therapies; and outlines various solutions including modernizing payment policy, adopting new modes of clinical management and improving data analytics.

Key Findings

  • Spending on specialty drugs in 2012 in the United States was about $87 billion. Estimates suggest it could quadruple by 2020, reaching about $400 billion.

  • About half of spending for specialty drugs is funded as a pharmacy benefit; the other half is funded as a medical benefit, leading to challenges in integrated clinical management.

  • Approximately 51 percent of spending on specialty drugs is for cancer, rheumatoid arthritis, and multiple sclerosis.

  • Specialty drugs particularly impact Medicare beneficiaries, who have relatively high spending (on a per person basis) for those drugs, about double the amount of spending by commercial health plan members.

  • Misaligned payment incentives are leading to the provision of drugs in high-cost care settings. For example, UnitedHealthcare finds that per member per month costs for injectable oncology drugs in outpatient hospital settings are about 30 percent higher than costs in physician office settings.

  • Greater use of coordination and adherence programs, of the kind provided by specialty pharmacies, shows particular promise in improving outcomes and reducing costs. UnitedHealth Group research has demonstrated that specialty pharmacy and synchronized medical and pharmacy services yielded total cost savings of about 13 percent for cancer and transplant services and increased compliance for patients with cancer, multiple sclerosis and rheumatoid arthritis.

  • Other approaches for effectively managing specialty pharmacy include adoption of new payment models, better information on treatments and outcomes, development of patient registries, clinical pathways, and new forms of collaboration between patients and providers. 


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