QuintilesIMS Institute report examines global spending trends through 2020

DANBURY, Conn. and RESEARCH TRIANGLE PARK, N.J. — The latest report from the QuintilesIMS Institute for Health for Healthcare Informatics is taking a look at how spending on medicines will change through 2021. The “Outlook for Global Medicines Through 2021: Balancing Cost and Value” report projects that total global spending will be close to $1.5 trillion on an invoice price basis through 2021. As this happens, the compound annual growth rate is expected to moderate, rising between 4% and 7% by 2021, compared to the 9% CAGR in 2014 and 2015. 

 

“The outlook for medicine spending growth reflects a more sustainable level for health systems, following the unexpectedly high growth seen in recent years,” Quintiles IMS Institute SVP and executive director Murray Aitken, said. “At the same time, the astonishing level of scientific advances for disease treatments inevitably will place ongoing pressure on funding for medicines—requiring value-based assessments that balance patient needs and pricing levels with competing healthcare priorities.”

 

The projected spending total reflects a global increase of $387 billion in spending on a constant-dollar basis. Over the next five years, the United States will continue to be the world’s largest pharmaceutical market, making up 53% of forecasted growth, with China in second place contributing 12% of the growth.  

 

Like the global market, the U.S. market’s growth will moderate in the next five years, going from 12% in 2015 to  6-7% in 2016, with an expected growth rate of 6% to 9% through 2021 on an invoice price basis. The decline, according to the report, is due to the dropoff in growth driven by hepatitis C treatments and the impact of patent expiries, including the introduction of biosimilars, following years of brands facing little new generic competition. 

 

But even as growth slows, the QuintilesIMS Institute expects the next five years to see historically high numbers of new drug launches. Through 2021, it’s projected that the more than 2,000 drugs in the late-stage pipeline will bring 45 new active substances to market annually. Much of these will focus on unmet needs in such disease areas as cancer, autoimmune disorders and metabolic and nervous system disorders.