The Top 5 Specialty Pharmacy Trends for Payers

In today's dynamic specialty drug landscape, staying ahead of trends is more than a proactive move—it's a necessity. As the cost and utilization of specialty drugs increase, payers need to stay informed, agile, and prepared to address emerging challenges and opportunities. Pharmaceutical Strategies Group (PSG) recently published its 2023 State of Specialty Spend and Trend Report using data from Artemetrx, its proprietary SaaS platform, and we’ve outlined five critical trends highlighted within the report that requires attention by payers of all sizes:

1. Specialty Drug Spend Continues to Swell

The specialty drug spending trajectory continues to rise, with a significant uptick in 2022 coming in at 14.1% on a gross basis, reduced to 12.5% net of rebates. The report notes that the top categories for specialty drug spend have remained unchanged since 2016, with inflammatory, oncology, and multiple sclerosis disease categories leading the way. Even the introduction and increased use of cost-saving biosimilars like Rituxan and Herceptin and specialty generics has been offset by the launch of new specialty drugs and the broader use of current ones.

2. Claim Utilization and Cost per Claim: A Double Challenge

In 2022, claim utilization alone contributed to 9.9% of the 14.1% trend, while the average cost per claim has also risen—indicating that a growing number of patients are using specialty drugs and specialty drugs are becoming pricier.

3. A Growing Cohort of Specialty Drug Users

While a 0.2% increase in members using specialty drugs between 2021 and 2022 might appear small, its impact on per member per year (PMPY) costs is far from insignificant. And with the average number of specialty claims per user remaining stable, findings suggest that the driving force behind this trend is a rise in new patients starting on specialty drugs.

4. Pharmacy Benefit Continues to Drive Overall Spend

In 2022, 56.3% of specialty spending was through the pharmacy benefit, up from 54.1% in 2021 and 52.4% in 2020. Behind this growth is the introduction of new, high-priced specialty drugs under the pharmacy benefit, the transformation of certain drugs previously billed under medical shifting to self-administered formats, and strategic moves by plan sponsors to maximize rebates and optimize utilization management.

5. Rebates & Reimbursements

Although rebates have a considerable impact on average cost per claim in the pharmacy benefit channel, PSG notes that the importance of rebates under the medical benefit should not be overlooked—the average cost per medical drug claim that was rebate eligible was $6,580, with an average rebate of $532. This is most notably due to the competition in the autoimmune class, primarily infliximab and biosimilars. With the increase of biosimilars and manufacturers fighting for market share, expect to see increase in rebate offerings to payers on medical drugs.

In Summary

PSG predicts that the PMPY trend for specialty drugs will continue in the low double digits for the next three years. This trajectory implies an anticipated increase in PMPY costs of nearly 50% from 2022 to 2025. These increasing drug costs are far reaching—new costs are being driven by entirely new problems, like the increase in multi-million-dollar gene therapy and new specialty drugs coming to market for previously untouched conditions. When coupled with regulatory pressures on PBMs and drug pricing, payers face a daunting task of trying to manage their financial risk while also embracing innovation and ensuring access to appropriate care.  

The market continues to evolve, with the only certainty being the importance of a flexible, forward-looking strategy that maximizes value for all stakeholders.