Express Scripts 2007 Drug Trend Report

Trend
Express Scripts 2007 Drug Trend Report

Trend
Tracking Trend
Throughout the year, Express Scripts works proactively with plan sponsors to help make the use of
prescription drugs safer and more affordable. We use a variety of programs and plan designs that
encourage the use of the most cost-effective agents, as well as safety programs that reduce untoward
effects of medication.
Once a year we look back and evaluate the previous year. But tracking trend is not just looking back; it is
also looking forward and understanding how the past drives the future. By recognizing what is happening
in the rapidly changing world of prescription-drug benefits, Express Scripts uses trend information
strategically to plan the best programs for our plan sponsors and their members. Trend is our compass
for the future.
In 2007, Express Scripts managed prescription-drug benefits for more than 55 million Americans,
representing thousands of plan sponsors in all 50 states. To profile prescription-drug trends, we evaluated
nonspecialty drugs and specialty drugs separately using a common data set, which includes a sample of
plan sponsors that were with Express Scripts in 2006 and 2007. From this sample, we randomly selected
approximately 3 million members among those enrolled at any time in 2006 or 2007 for analysis.
Included in the sample were plan sponsors that offered funded, fully integrated prescription-drug benefits
within the commercially insured market and that had enrollment changes of no more than 50% between
2006 and 2007. Selecting plan sponsors with fully integrated benefits ensures that we capture all Home
Delivery claims, as well as claims adjudicated through participating pharmacies. We focused on the
commercially insured market, excluding members receiving prescriptions through Medicaid and Medicare
Part D because of the unique eligibility requirements, utilization patterns and copayment structures
among noncommercial groups.
In 2007, the calculation of prevalence was changed to more accurately estimate the proportion of
members who fill at least one prescription from one year to the next. The previous methodology slightly
overestimated prevalence of use.
Trend
Prescription-cost trends were evaluated on a per member per year (PMPY) basis and analyzed across three
main components:
1. Per-prescription costs for common drugs (those dispensed in both 2006 and 2007), which were
further divided into the influences of:
• Price Inflation
• Units per Prescription
• Brand/Generic Mix
• Therapeutic Mix
2. Utilization for common drugs, also broken into two major components:
• Prevalence — the percentage of patients filling prescriptions from year to year
• Intensity — the year-to-year number of prescriptions filled
3. Impact of new drugs
express scripts 2007 drug trend report 5

Overall Drug Trend
For 2007, overall trend was 5.5%, the lowest seen since Express Scripts began tracking trend. For
nonspecialty drugs, trend was only 4.7%, down 1.2 percentage points from 2006. Notable is that
brand/generic mix decreased 4.4%, reflecting the impact of newly introduced generics for brand-name
drugs. The specialty-drug trend of 14% compared favorably to the 20.9% specialty trend in 2006.
Nonspecialty-Drug Trend
Exhibit 4
Components of PMPY Nonspecialty Cost Trend 2004 to 2007*
Trend
AWP Less Discount AWP Less Discount Ingredient Cost Ingredient Cost
2003 vs. 2004 2004 vs. 2005 2005 vs. 2006 2006 vs. 2007
Price Inflation 6.0% 5.3% 4.3% 5.0%
X Units per Prescription 0.2% 0.1% 0.4% 0.5%
X Brand/Generic Mix -2.6% -2.7% -2.9% -4.4%
X Therapeutic Mix 3.7% 0.8% 1.7% 1.1%
= Cost per Prescription 7.2% 3.3% 3.5% 2.0%
X Utilization 2.9% 4.0% 2.2% 2.5%
= Common Drugs 10.4% 7.5% 5.8% 4.6%
+ New Drugs 0.3% 0.4% 0.2% 0.1%
= All Drugs 10.6% 7.9% 5.9% 4.7%
* The percentage contribution of each factor does not total to the All Drugs percentage increase. The calculation takes the base
cost for a given year and multiplies it by one plus the percentage contributed by the first factor (price). The resulting total is
then multiplied by the percentage contributed by the second factor (number of units dispensed), and so on for each Common
Drugs factor. The percentage contribution of the New Drugs is then added to the total Common Drugs percentage, to yield an
All Drugs percentage increase. Final results may differ due to rounding.
Of the 4.7% nonspecialty increase from 2006 to 2007:
• 53.4% was due to increased utilization
• 43.6% was due to increased cost
• 3% was due to the introduction of new medications
Exhibit 5 presents the top 20 nonspecialty therapy classes ranked by PMPY cost. These therapy classes,
representing 75% of nonspecialty-drug spend in 2007, had a 4.1% increase in total spending, as
compared to a 6.7% trend for all other nonspecialty therapy classes.
Eight of the top 20 nonspecialty therapy classes had double-digit trend increases in PMPY cost, driven
in large part by per-prescription cost growth. Also contributing to higher trend for the antidiabetics
and anticonvulsants classes were increases in prevalence of use (4.2% and 7%, respectively).
As expected, however, significant decreases in PMPY cost were seen in therapy classes that had
major new generics introduced in 2006 or 2007. In fact, four therapy classes — antihyperlipidemics,
antidepressants, calcium blockers and NSAIDs — had negative PMPY cost trend, ranging from
-3.3% to more than -12%.
6 express scripts 2007 drug trend report

Exhibit 5
Top 20 Nonspecialty Therapy Classes 2006 to 2007
Ranked by 2007 PMPY Cost
PMPY Cost
Cost per Rx (Common Drugs)
Therapy Class 2006 2007 Trend 2006 2007 Trend
1 Antihyperlipidemics $ 91.53 $ 83.32 -9.0% $ 79.48 $ 67.32 -15.3%
2 Gastrointestinals $ 62.50 $ 63.09 1.0% $100.38 $ 99.19 -1.2%
3 Antidepressants $ 58.88 $ 56.91 -3.3% $ 62.08 $ 58.17 -6.3%
4 Antidiabetics $ 42.67 $ 49.50 16.0% $ 65.23 $ 73.55 12.8%
5 Antiasthmatics $ 40.65 $ 45.82 12.7% $ 83.65 $ 92.17 10.2%
6 Antihypertensives $ 41.20 $ 45.19 9.7% $ 33.70 $ 35.73 6.0%
7 Anticonvulsants $ 27.36 $ 31.88 16.6% $ 96.98 $105.82 9.1%
8 Narcotic Analgesics $ 23.54 $ 27.00 14.7% $ 39.20 $ 43.03 9.8%
9 Dermatologicals $ 20.83 $ 22.89 9.9% $ 65.04 $ 70.68 8.7%
10 Antivirals $ 18.56 $ 21.27 14.6% $214.50 $234.76 9.4%
11 Stimulants/Antiobesity $ 17.23 $ 19.24 11.7% $112.96 $120.81 6.9%
12 Misc. Endocrines $ 17.72 $ 18.33 3.5% $ 73.59 $ 78.83 7.1%
13 Antipsychotics $ 14.50 $ 16.67 15.0% $172.49 $190.07 10.2%
14 Contraceptives $ 14.53 $ 16.12 11.0% $ 29.68 $ 31.97 7.7%
15 Antihistamines $ 15.38 $ 15.49 0.7% $ 49.92 $ 50.13 0.4%
16 Beta Blockers $ 15.12 $ 15.38 1.7% $ 23.73 $ 23.49 -1.0%
17 Calcium Blockers $ 15.16 $ 13.28 -12.4% $ 43.32 $ 38.12 -12.0%
18 NSAIDs $ 14.97 $ 13.16 -12.1% $ 44.45 $ 39.26 -11.7%
19 Misc. Hematologicals $ 11.45 $ 12.56 9.7% $101.06 $106.04 4.9%
20 Decongestants $ 12.14 $ 12.26 1.0% $ 59.89 $ 59.71 -0.3%
Top 20 $575.92 $599.38 4.1% $ 62.00 $ 62.54 0.9%
Others $186.84 $199.38 6.7% $ 37.12 $ 38.99 5.1%
Total $762.76 $798.76 4.7% $ 53.25 $ 54.34 2.0%
Trend
Price Inflation
Price inflation reflects the impact of changes in pharmaceutical manufacturers’ unit prices. Actual
ingredient costs including discounts but excluding rebates are represented. After three years of decreases,
overall price inflation began to climb from a rate of 4.3% in 2006 to 5% in 2007. Among the top 20
nonspecialty classes, 12 had price increases above the overall price inflation.
As in previous years, price inflation for branded products (7.4%) was dramatically higher than the
generic inflation rate (-3.1%). Therapy classes with double-digit brand-price inflation included
dermatologicals (13.5%), contraceptives (10.7%) and narcotic analgesics (10.6%).
express scripts 2007 drug trend report 7

As shown in Exhibit 6, narcotic analgesics was the only class that had double-digit price inflation for
both brand and generics from 2006 to 2007. The main contributor was one drug, OxyContin ® , which is
regaining brand-only status after court decisions forced its generics off the market.
Pushing the generic inflation rate lower were a number of therapy classes, including
antihyperlipidemics (-38.4%) and antidepressants (-14.9%), which experienced patent
expirations in 2006. However, the full price decreases of the generics were felt in 2007
when the first generic products lost market exclusivity, and competition increased. Generic
price also dropped by double digits for gastrointestinals (-14%), which felt the effect of
greater price reductions for omeprazole (generic Prilosec ® ).
Trend
Exhibit 6
Brand and Generic Price Changes for Top 20 Nonspecialty Therapy Classes 2006 to 2007
Ranked by Total Percent Change
Price % Change
Therapy Class Brand Generic Total
1 Narcotic Analgesics 10.6% 22.6% 20.2%
2 Antihypertensives 7.7% 10.7% 8.4%
3 Antiasthmatics 7.4% 17.9% 8.0%
4 Stimulants/Antiobesity 9.5% -10.0% 7.9%
5 Antipsychotics 8.1% -2.7% 7.7%
6 Antidiabetics 7.6% 6.8% 7.5%
7 Beta Blockers 5.0% 14.9% 7.3%
8 Dermatologicals 13.5% -7.3% 7.3%
9 Contraceptives 10.7% 3.5% 7.2%
10 Antivirals 7.1% -0.9% 6.8%
11 Anticonvulsants 9.5% -5.6% 6.6%
12 Misc. Endocrines 6.3% -9.3% 5.3%
13 Decongestants 8.5% -4.0% 5.0%
14 Calcium Blockers 8.9% -2.5% 4.5%
15 Antihistamines 9.3% -4.0% 3.8%
16 Gastrointestinals 5.0% -14.0% 2.2%
17 Antidepressants 8.7% -14.9% 1.9%
18 NSAIDs 7.1% -7.6% 1.7%
19 Misc. Hematologicals 0.6% -5.2% -1.2%
20 Antihyperlipidemics 4.4% -38.4% -2.0%
Total 7.4% -3.1% 5.0%
Brand/Generic Mix
Brand/Generic mix measures the percentage of change in per-prescription costs due to changes in
the relative percentages of brand-name drugs and generics within classes. Movement from brands to
generics drives down trend for brand/generic mix; and, less frequently, changes from generics to brands
increase it.
8 express scripts 2007 drug trend report

Major generic introductions slowed, with only two blockbuster drugs — Ambien ® (a hypnotic) and
Norvasc ® (a calcium blocker) — losing patent protection in 2007. The impact of 2006 patent expirations
continued to drive greater use of generic medications, however, resulting in an overall -4.4% trend in 2007.
The impact of generics for Norvasc, the fifth-best-selling prescription drug in the U.S. in 2006, drove down
the brand/generic mix for calcium blockers by 15.8%. Beta blockers, NSAIDs and antidepressants also
had double-digit negative percent changes in brand/generic mix.
The phaseout of generics for Plavix ® resulted in an unusual increase in brand/generic mix of 5% for the
miscellaneous hematologicals class. In 2008, a similar withdrawal of generics for OxyContin will cause
a positive brand/generic mix for narcotic analgesics.
Exhibit 7
Changes in Brand/Generic Mix for Top 20 Nonspecialty Therapy Classes 2006 to 2007
Ranked by Percent Change
Therapy Class Key Generic Introductions % Change
1 Calcium Blockers Norvasc ® (3/2007), Verelan ® PM (8/2007) -15.8%
2 Beta Blockers Inderal ® LA (1/2007), Toprol-XL ® (7/2007), Coreg ® (9/2007) -11.2%
3 NSAIDs Arava ® (9/2005), Mobic ® (7/2006) -10.8%
4 Antidepressants Zoloft ® (8/2006), Effexor ® (8/2006), Wellbutrin XL ® 300mg
(12/2006)
-10.7%
5 Antihyperlipidemics Pravachol ® (4/2006), Zocor ® (6/2006), Colestid ® (10/2006) -9.1%
6 Narcotic Analgesics Duragesic ® (1/2005), Ultracet ® (4/2005), OxyContin ® * (6/2005),
Actiq ® (9/2006), Combunox ® (11/2007)
-7.0%
7 Decongestants Flonase ® (3/2006) -4.1%
8 Contraceptives Ovcon ® 35 (10/2006), Estrostep ® Fe (10/2007) -1.9%
9 Antihypertensives Univasc ® (12/2006), Mavik ® (2/2007), Uniretic ® (3/2007),
Lotrel ® (5/2007), Altace ® (12/2007)
-1.8%
10 Dermatologicals Elocon ® (3/2005) -1.5%
11 Anticonvulsants Lamictal ® 5mg and 25mg chewable (4/2005), Zonegran ®
(12/2005), Cerebyx ® (8/2007), Trileptal ® (10/2007)
-0.7%
12 Antihistamines Allegra ® (9/2005), Zyrtec ® (12/2007) -0.7%
13 Misc. Endocrines DDAVP ® Tablets (7/2005) -0.6%
14 Stimulants/Antiobesity Focalin ® (6/2007), Adipex-P ® (8/2007) -0.3%
15 Gastrointestinals Protonix ® (12/2007) -0.2%
16 Antivirals Retrovir ® (9/2005), Copegus ® (12/2005), Famvir ® (9/2007) -0.2%
17 Antipsychotics N/A -0.2%
18 Antidiabetics Metaglip ® (10/2005), Amaryl ® (10/2005) -0.2%
19 Antiasthmatics DuoNeb ® (7/2007), AccuNeb ® (9/2007) -0.1%
20 Misc. Hematologicals Plavix ® * (8/2006) 5.0%
Top 20 -4.2%
Others -4.8%
Total -4.4%
* Generics later removed from the market
Trend
express scripts 2007 drug trend report 9

Utilization
For nonspecialty drugs, the 2.5% overall utilization increase was consistent with the 2.2% change from
2005 to 2006. Prevalence (the proportion of users within the population) increased only 0.7%; virtually
unchanged from the 1% increase for 2006. Intensity (treatment duration) increased 1.8% compared to
1.2% in 2006.
The highest utilization growth rates among the top 20 nonspecialty classes were antihyperlipidemics
(7.5%) and anticonvulsants (6.8%). Increased use of lower-cost generics caused the growth in
antihyperlipidemics; greater prevalence was the main growth factor for anticonvulsants. Miscellaneous
hematologicals, antivirals and narcotic analgesics each had utilization increases of 4.5%. Driving greater
use in the miscellaneous hematologicals class was Plavix, which increased market share from 57% to
74%. Generic Plavix was launched at risk in 2006, but it was removed from the market after litigation.
Utilization decreased in four of the top 20 nonspecialty classes, with miscellaneous endocrines seeing the
largest decline (-3.4%). This therapy class includes bisphosphonates, which continued their year-overyear
decline — largely due to concerns over possible side effects and difficulty in taking the drugs.
Trend
Exhibit 8
Utilization of Common Drugs for Top 20 Nonspecialty Therapy Classes 2006 to 2007
Ranked by Total Percent Change
Prescriptions PMPY
% Change
Therapy Class 2006 2007 Prevalence Intensity Total
1 Antihyperlipidemics 1.15 1.24 4.8% 2.5% 7.5%
2 Anticonvulsants 0.28 0.30 7.0% -0.1% 6.8%
3 Misc. Hematologicals 0.11 0.12 0.3% 4.2% 4.5%
4 Antivirals 0.09 0.09 2.1% 2.4% 4.5%
5 Narcotic Analgesics 0.60 0.63 2.4% 2.0% 4.5%
6 Antipsychotics 0.08 0.09 0.9% 2.7% 3.6%
7 Stimulants/Antiobesity 0.15 0.16 3.3% 0.2% 3.5%
8 Antidepressants 0.95 0.98 1.0% 2.1% 3.1%
9 Contraceptives 0.49 0.50 1.4% 1.5% 3.0%
10 Antihypertensives 1.22 1.26 3.3% -0.4% 2.9%
11 Beta Blockers 0.64 0.65 1.6% 1.1% 2.7%
12 Antidiabetics 0.65 0.67 4.2% -1.9% 2.2%
13 Antiasthmatics 0.49 0.50 0.8% 1.5% 2.2%
14 Gastrointestinals 0.62 0.64 1.1% 1.0% 2.2%
15 Decongestants 0.20 0.21 0.5% 0.8% 1.3%
16 Dermatologicals 0.32 0.32 0.8% 0 0.9%
17 Antihistamines 0.31 0.31 -1.1% 1.0% -0.1%
18 Calcium Blockers 0.35 0.35 -0.4% -0.1% -0.5%
19 NSAIDs 0.34 0.34 0.9% -1.4% -0.6%
20 Misc. Endocrines 0.24 0.23 -4.7% 1.4% -3.4%
Top 20 9.29 9.58 2.1% 0.9% 3.1%
Others 5.03 5.10 -2.0% 3.5% 1.4%
Total 14.32 14.68 0.7% 1.8% 2.5%
10 express scripts 2007 drug trend report

Age
One of the most important factors in utilization is age. As an individual ages, the risk of chronic disease
increases, and the need for prescription medications usually goes up as well. Consequently, spend is
highest among older members. However, although PMPY spending increased across all age groups from
2006 to 2007, total trend for members aged 65 and older (4%) was actually lower than trend for children
up to the age of 17 (6%) and adults aged 18 years to 44 years (5.5%), as shown in Exhibit 9.
Exhibit 9
PMPY Spending by Age Group 2006 to 2007
Total
Trend = 4.7%
65+
Trend = 4%
Age Group
45 to 64
Trend = 3.3%
2007
18 to 44
Trend = 5.5%
2006
0 to 17
Trend = 6%
$0 $500 $1,000 $1,500 $2,000 $2,500
PMPY Spending
The mix of therapy classes also varies with age. Looking across the generations presents a very different
picture of the primary drivers of trend and reflects the conditions most affecting each age group. Although
younger individuals tend to use more acute-care drugs, such as antibiotics, chronic conditions are
becoming more prevalent at earlier ages. Exhibits 10 and 11 show the top 10 therapy classes shaping
trend across the various age groups.
Trend
For children aged 0 to 17 years, the top therapy classes driving 2007 trend were for asthma, attention
deficit and attention deficit hyperactivity disorders, and skin conditions. Negative trend was seen only
in penicillins and macrolides. As the use of chronic medications grows among children and adolescents,
therapies affecting trend in this age group will change.
PMPY 2007 trend among adults aged 18 years to 44 years increased by double digits for six of the
top 10 classes for the age group. PMPY trend was down for antidepressants, gastrointestinals
and antihyperlipidemics.
express scripts 2007 drug trend report 11

Exhibit 10
Top 10 Nonspecialty Therapy Classes for Ages 0 to 17 and Ages 18 to 44
Ranked by 2007 PMPY Cost
Therapy Class
Ages 0 to 17 Ages 18 to 44
PMPY
Cost
2007 2007
Trend
Therapy Class
PMPY
Cost
Trend
1 Antiasthmatics $40.94 11.2% 1 Antidepressants $50.10 -5.6%
2 Stimulants/Antiobesity $34.70 8.9% 2 Contraceptives $37.71 11.1%
3 Dermatologicals $19.17 7.5% 3 Anticonvulsants $30.68 18.6%
4 Antipsychotics $13.29 13.2% 4 Gastrointestinals $28.92 -1.6%
5 Cephalosporins $11.81 3.1% 5 Antivirals $24.86 11.3%
6 Anticonvulsants $11.78 5.8% 6 Antiasthmatics $23.45 12.8%
7 Antihistamines $10.63 3.4% 7 Dermatologicals $21.83 9.9%
8 Penicillins $ 8.42 -8.1% 8 Narcotic Analgesics $21.03 13.3%
9 Macrolides $ 6.67 -7.2% 9 Antidiabetics $17.29 13.7%
10 Gastrointestinals $ 6.07 8.9% 10 Antihyperlipidemics $16.65 -9.2%
For adults aged 45 years to 64 years, PMPY cost trend decreased for the top three therapy classes:
antihyperlipidemics, gastrointestinals and antidepressants. Costs grew at double digits for antidiabetics,
antiasthmatics, narcotic analgesics, anticonvulsants and antivirals.
Trend
A similar pattern was seen among adults aged 65 years and older, with costs increasing for every class
except antihyperlipidemics, antidepressants and calcium blockers. PMPY cost trend grew by double digits
for antihypertensives, antidiabetics and antiasthmatics.
Exhibit 11
Top 10 Nonspecialty Therapy Classes for Ages 45 to 64 and Ages 65 and Older
Ranked by 2007 PMPY Cost
Therapy Class
Ages 45 to 64
PMPY
Cost
Ages 65 and Older
2007 2007
Trend
Therapy Class
PMPY
Cost
Trend
1 Antihyperlipidemics $162.73 -9.4% 1 Antihyperlipidemics $303.02 -10.7%
2 Gastrointestinals $110.95 -0.1% 2 Gastrointestinals $188.02 1.4%
3 Antidepressants $ 98.59 -2.5% 3 Antihypertensives $168.31 10.4%
4 Antidiabetics $ 93.92 14.6% 4 Antidiabetics $148.00 17.1%
5 Antihypertensives $ 84.49 8.1% 5 Antiasthmatics $114.99 13.8%
6 Antiasthmatics $ 56.85 12.0% 6 Misc. Endocrines $ 92.88 3.7%
7 Narcotic Analgesics $ 49.68 13.6% 7 Misc. Hematologicals $ 73.25 6.4%
8 Anticonvulsants $ 45.67 15.6% 8 Antidepressants $ 71.70 -1.5%
9 Antivirals $ 34.13 16.4% 9 Beta Blockers $ 69.44 2.8%
10 Misc. Endocrines $ 29.02 0.9% 10 Calcium Blockers $ 64.09 -11.2%
12 express scripts 2007 drug trend report

Gender
The use of prescription drugs also varies by gender. Females are more likely than males to use
prescription drugs. Additionally, females use more prescription drugs — with females in our 2007
sample averaging 16.7 prescriptions PMPY, compared to 12.6 for males.
Although not as dramatic as the differences among age groups, both PMPY spending and trend differed
for males and females. On average, female spend was about 20% higher than male spend, and females
had a trend of 5.1%, compared to 4.4% for males.
Exhibit 12
PMPY Spending and Trend for Females and Males 2006 to 2007
Females
Trend = 5.1%
Males
Trend = 4.4%
2007 PMPY
2006 PMPY
$0 $200
$400 $600 $800 $1,000
Eight of the top 10 nonspecialty therapy classes for females also were among the top 10 for males. In the
top 10 for females — but not for males — were miscellaneous endocrines and contraceptives. In the top
10 for males only were antivirals and stimulants/antiobesity agents. The mix and contribution to trend
differed, as shown in Exhibit 13.
Trend
Exhibit 13
Top 10 Nonspecialty Therapy Classes for Females and Males
Ranked by 2007 PMPY Cost
Therapy Class
Females
PMPY
Cost
Males
2007 2007
Trend
Therapy Class
PMPY
Cost
Trend
1 Antidepressants $78.30 -2.6% 1 Antihyperlipidemics $101.46 -7.9%
2 Gastrointestinals $68.81 1.1% 2 Antidiabetics $ 57.41 16.0%
3 Antihyperlipidemics $66.26 -10.6% 3 Gastrointestinals $ 56.98 0.8%
4 Antiasthmatics $49.13 11.9% 4 Antihypertensives $ 49.20 9.6%
5 Antidiabetics $42.05 15.8% 5 Antiasthmatics $ 42.28 13.8%
6 Antihypertensives $41.41 9.6% 6 Antidepressants $ 34.12 -4.8%
7 Anticonvulsants $39.87 19.0% 7 Antivirals $ 26.80 13.8%
8 Misc. Endocrines $31.45 2.4% 8 Narcotic Analgesics $ 24.70 11.7%
9 Contraceptives $31.19 -2.6% 9 Anticonvulsants $ 23.37 -7.9%
10 Narcotic Analgesics $29.16 1.1% 10 Stimulants/Antiobesity $ 22.30 16.0%
express scripts 2007 drug trend report 13

New Drugs
In 2007, the contribution of new drugs to overall nonspecialty trend was only 0.1%, the lowest since 1993,
when Express Scripts started tracking trend.
The low number of U.S. Food and Drug Administration (FDA) approvals seen since 2005 continued, with
only 17 new molecular entities and two new biological agents approved during the year.
Janumet ® accounted for more than one-quarter of market share among new drugs and 2.4% of market
share for antidiabetics. The second-place nonspecialty drug, Vyvanse , contributed only 0.9% of market
share to the stimulants/antiobesity class.
Trend
Exhibit 14
Top 10 New Nonspecialty Prescription Drugs of 2007
Ranked by PMPY Cost
Brand Name Generic Name Therapy Class PMPY % New Drug
1 Janumet ® sitagliptin and Antidiabetics $0.29 27.1%
metformin
2 Vyvanse lisdexamfetamine Stimulants/Antiobesity $0.16 14.9%
3 Invega ® paliperidone Antipsychotics $0.13 11.6%
4 Tekturna ® aliskiren Antihypertensives $0.12 10.9%
5 Exforge ® amlodipine and Antihypertensives $0.10 9.6%
valsartan
6 Xyzal ® levocetirizine Antiallergics $0.05 5.1%
7 Altabax retapamulin Dermatologicals $0.04 4.1%
8 Neupro ® rotigotine Antiparkinson Agents $0.04 3.5%
9 Isentress ® raltegravir Antivirals $0.02 2.1%
10 Brovana ® arformoterol Antiasthmatics $0.02 2.1%
Top 10 $0.99 91.0%
Others $0.10 9.0%
Total $1.08 100.0%
Cost
Although new drugs typically do not contribute a significant amount to total PMPY cost or utilization,
Exhibit 15 shows the cumulative effect of new drugs over time. Blockbuster drugs introduced in 1995
(Fosamax ® , Prevacid ® , Valtrex ® and Zyrtec ® ) and 1996 (Allegra ® , Diovan ® , Lipitor ® and Topamax ® )
accounted for 14% of 2007 costs. More than 75% of prescriptions in 2007 were filled with drugs
introduced in 1994 or earlier. In contrast, drugs introduced between 2002 and 2006 represented
only 10.3% of costs and 5% of prescriptions in 2007.
14 express scripts 2007 drug trend report

Exhibit 15
Impact of New Drugs on 2007 Cost and Utilization
Percent of 2007 Cost
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0
Percent of 2007 Prescriptions
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0
2004-2007
2001-2003
1998-2000
1995-1997
1994 and Before
Member Cost Trend
The change in per-prescription costs is shared proportionally by both plan sponsors and members through
year-to-year changes in member copayments. To examine how the per-prescription cost increases were
being shared by members and plan sponsors, we segmented the per-prescription cost trend by member
cost and net plan sponsor cost. Because member cost for specialty medications is typically much lower
as a proportion than member cost for nonspecialty medications, we examined nonspecialty, specialty
and total per-prescription cost trends separately.
If plan sponsors were attempting to control costs by shifting a greater proportion of costs to members
through increased member cost, the overall trend for plan sponsors would be lower relative to member
per-prescription share. However, from 2006 to 2007, member share of per-prescription costs remained
relatively flat, decreasing by 0.4% for nonspecialty and increasing by 0.3% for specialty.
Trend
Exhibit 16
Changes in Member and Plan Sponsor Per-Prescription Costs 2006 to 2007*
Nonspecialty Specialty Total
Member Cost -0.4% 0.3% -0.3%
+ Plan Sponsor Cost 2.5% 8.3% 3.2%
= Cost per Prescription 2.1% 8.6% 2.9%
X Utilization 2.6% 5.0% 2.6%
= All Drugs 4.7% 14.0% 5.5%
* The percentage contribution of each factor may not total the All Drugs percentage increase because the total is
multiplicative, not additive. Final results may differ due to rounding.
Influencing the negative cost-per-prescription trend for members was the brand/generic mix. Members
saved an average of $15 per prescription when they moved from a brand to a generic. Although plan
sponsors saved as well, given inflation and therapeutic-mix trends, plan sponsors paid a higher overall
portion of total cost in 2007 compared to 2006. Total cost includes administrative fees, taxes and
dispensing fees.
Exhibit 17 on the next page shows that member cost as a proportion of total prescription cost decreased
from 24.5% to 23.6% for nonspecialty medications. Proportionally, member cost of total specialty costs
remained the same — leading to a reduction of approximately one percentage point in the proportion of
total prescription cost paid by members from 2006 to 2007.
express scripts 2007 drug trend report 15

Exhibit 17
Changes in Member and Plan Sponsor Total Cost Percentages 2006 to 2007
% Total Cost
Nonspecialty Specialty Total
2006 2007 2006 2007 2006 2007
Member Share 24.5% 23.6% 2.6% 2.6% 22.5% 21.6%
Plan Sponsor Share 75.5% 76.4% 97.4% 97.4% 77.5% 78.4%
Total 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
Managing Trend
Even though member cost decreased slightly in 2007, prescription costs can be a significant financial
burden for some members. By promoting the use of lower-cost agents, such as generics, plan sponsors
can maintain a fair share of the total costs, while ensuring clinically appropriate drug therapies and
helping members lower their out-of-pocket expenses. Express Scripts believes that plan sponsors have
unprecedented opportunities to benefit from generic savings by increasing generic fill rates (GFRs),
implementing Step Therapy and targeting member communications.
Trend
Generic Savings Opportunities Remain Strong
Although generic utilization is at an all-time high, there is still “room to run” with regard to nonspecialty
generic opportunities. Even in the generics-rich therapy classes, GFRs can be increased — by more than
50 percentage points in some classes. Maximizing the GFR in a few strategic therapy classes could result
in as much as $20 billion in savings for plan sponsors and members, as calculated by Express Scripts
researchers and shown in Exhibit 18.
Exhibit 18
Potential Savings From Maximized Generic Fill Rates
Therapy Class
2007 Generic Fill Rate
Actual
Potential
Potential Savings
(in $ Thousands)
Gastrointestinals 38.6% 95% $ 5,659,682
Antihyperlipidemics 37.9% 80% $ 4,584,257
Antidepressants 66.8% 88% $ 2,680,877
Antihypertensives 58.9% 83% $ 2,340,994
Anticonvulsants 51.6% 73% $ 1,421,269
Antidiabetics 55.1% 60% $ 593,507
Hypnotics 47.9% 70% $ 559,912
Beta Blockers 76.8% 89% $ 495,529
Antihistamines 55.3% 95% $ 491,421
Systemic and Topical
Nasal Products
46.4% 90% $ 474,027
Contraceptives 63.3% 90% $ 405,622
Narcotic Analgesics 95.5% 97% $ 259,044
Antipsychotics 26.7% 30% $ 123,636
Total $20,089,778
16 express scripts 2007 drug trend report

Impact of Step Therapy
Plan sponsors can save in a number of ways from increased use of generics. For therapy classes
that include comparable drugs, our Step Therapy programs encourage the use of effective, low-cost
prescription drugs, still allowing for movement to higher-cost therapies, if needed.
Beginning in 2006, plan sponsors had exceptional opportunities to curb costs by using Step Therapy
in two nonspecialty classes — hypnotics and antihyperlipidemics. Plan sponsors implementing a
Step Therapy program in the hypnotics therapy class took advantage of generics for Ambien to realize a
fourfold reduction in therapy-class trend, compared to plan sponsors that did not implement hypnotics
Step Therapy. Plan sponsors initiating Step Therapy for antihyperlipidemics tripled their decrease in trend,
compared to plan sponsors without Step Therapy for the class, as shown in Exhibit 19.
Exhibit 19
Impact of Implementing Step Therapy on PMPY Cost 2006 to 2007
Hypnotics
antihyperlipidemics
0
0
Trend
-2%
-4%
-6%
-8%
-10%
-12%
-14%
-16%
-18%
Step Therapy (96 Plans)
Trend
-2%
-4%
-6%
-8%
-10%
-12%
-14%
Step Therapy (188 Plans)
Trend
No Step Therapy (947 Plans)
No Step Therapy (855 Plans)
All Plans
All Plans
Taking Advantage of Generic Opportunities One Consumer at a Time
Another way to take advantage of the generic opportunity is by engaging members and informing them
about their savings opportunities. A prime example occurred within the antihyperlipidemics class.
Anticipating that generics would be introduced for Zocor ® in mid-2006, Express Scripts removed Lipitor
from its formulary at the end of 2005.
On Oct. 1, 2005, a targeted communications strategy was launched to inform appropriate members of
lower-cost options for Lipitor. Selected members were continuously eligible for all of 2005 and 2006 under
a commercial plan sponsor with a flat three-tiered prescription-drug benefit. They all had filled at least
one Lipitor prescription between June 1 and Nov. 15, 2005, and their plan sponsors had removed Lipitor
from their formularies. The case group — members in plans that used targeted communications —
included 165,758 individuals. A control group consisted of 201,233 members that did not receive
targeted communications.
Formulary notification letters were sent to all members in the case group. Reinforcement was provided
through consistently framed messages on the Express Scripts member website and through a tollfree
phone line. Members using Home Delivery received additional information with their last Lipitor
prescriptions of 2005 and in automated refill reminder calls.
express scripts 2007 drug trend report 17

The adjusted rate of switching to a preferred formulary alternative for members in the control group was
approximately 15%. As shown in Exhibit 20, the adjusted switch rates for members enrolled in the case
group were nearly two times greater (28%) through participating pharmacies and almost three times
greater (43%) through Home Delivery.
Exhibit 20
Effect of Consistently Framed Communications
Formulary
Change Only
Plus Targeted
Messaging
Participating Pharmacies
and Home Delivery
Participating Pharmacies
Home Delivery
Plus Targeted
Messaging
0 10%
20% 30% 40% 50%
Percent Switching to a Preferred Formulary Alternative
Trend
Specialty-Drug Trend
In 2007, the 14% increase in specialty-drug spend was attributed to three factors:
1. Increased utilization was responsible for 60.4%.
2. Increased costs contributed 34.7%.
3. New medications added 4.9%.
In some specialty therapy classes, such as inflammatory conditions, trend was driven primarily by more
patients who used prescription drugs in the class. Increased utilization resulted not only from a greater
number of indications that biologic medications can treat, but also from the increasing number of
specialty medications that are shifting from medical benefits. In the cancer category, for instance,
new oral therapies that are covered by the prescription-drug benefit have replaced some injectable
drugs that normally are paid through the medical benefit.
Increases in cost were the second-largest factor in specialty trend. In almost all the specialty therapy
classes detailed in the Therapy Class Review section, price increases by the manufacturer or distributor
contributed heavily to trend. For instance, the average cost for a prescription to treat multiple sclerosis
jumped from $1,470 in 2006 to $1,647 in 2007.
As shown in Exhibit 21, only a few specialty drugs were approved in 2007. Typically, new specialty
products have more impact on trend than new nonspecialty drugs. For example, only two new specialty
products — Letairis , to treat pulmonary arterial hypertension, and the anticancer agent Tykerb ® —
gave rise to almost 5% of specialty trend in 2007.
18 express scripts 2007 drug trend report

Exhibit 21
Specialty Drugs Approved in 2007
Drug Indication Month of Approval
Hycamtin ® capsules Small-cell lung cancer October
Ixempra Breast cancer December
Kuvan Phenylketonuria October
Letairis Pulmonary arterial hypertension June
Reclast ® Osteoporosis, Paget’s disease of bone August
Soliris ® Paroxysmal nocturnal hemoglobinuria March
Somatuline ® Depot Acromegaly August
Supprelin ® LA Central precocious puberty May
Tasigna ®
Philadelphia chromosome-positive chronic
October
myelogenous leukemia
Torisel ® Renal cell carcinoma May
Tykerb ®
Breast cancer (HER2 positive) in combination
with Xeloda ®
March
Brand/Generic mix continues to be one cost driver that cannot help specialty classes in the same ways
that it affects nonspecialty. The lack of pathways for manufacturing generic biologics remains a barrier
for the number of generic opportunities available to specialty-drug patients. Express Scripts continues to
work with Congress, the FDA and a coalition of payers and employers to develop an approval pathway for
generic biotech drugs.
Trend
express scripts 2007 drug trend report 19

Notes
Trend
20 express scripts 2007 drug trend report