IMS Institute projects U.S. drug spending up by 34% by 2020

DANBURY, Conn. - In the U.S., pharmaceutical spending on an invoice price basis will reach as high as $590 billion by 2020, the IMS Institute for Healthcare Informatics reported Wednesday, representing a 34% increase over the 2015 level of spending. The dispensing rate of generic medicines will increase from 88% to as high as 92% by 2020. 

 

And as many as 225 new molecules will be brought to market, with one in three focused on treating cancer. 

 

"This is further evidence of the strength of the pipeline with respect to bringing clincally differentiated and new medicines to market, not only in cancer, but also in hepatitis-C, auto-immune disorders, heart disease and a wide array of rare diseases as well," commented Murray Aitken, IMS Health senior vice president and executive director of the IMS Institute for Healthcare Informatics, during a press conference with journalists. "We're expecting, indeed, 75 new orphan drugs will come through by 2020."

 

Worldwide, IMS is projecting that total drug spend will increase 30% from 2015 through 2020 and will reach $1.4 trillion in 2020. "Much of this growth is due to greater access to medicines, particularly in lower- to middle-income countries," Aitken said. "We're projecting that the total volume of medicines consumed in 2020 will be 4.5 trillion doses, that is up 24% from the level of 2015, mostly driven by increased access in the large pharmerging markets."

 

More than half of the world’s population will live in countries where medicine use will exceed one dose per person per day by 2020, up from 31% in 2005, as the “medicine use gap” between developed and pharmerging markets narrows. 

 

Global spending is forecast to grow at a 4%-7% compound annual rate over the next five years.

 

“During the next five years, we expect to see a surge of innovative medicines emerging from R&D pipelines, as well as technology-enabled advances that will deliver measurable improvements to health outcomes,” Aitken stated. “With unprecedented treatment options, greater availability of low-cost drugs and better use of evidence to inform decision making, stakeholders around the world can expect to get more ‘bang for their medicine buck’ in 2020 than ever before.”