2009 Drug Trend Insights - Prime Therapeutics

Rising Costs. Rigorous Management.Our low total trend (0.9 percent) dramatically contrasts with the projected 6.9 percent increasein national health expenditures, nearly twice the rate of inflation in 2008. 19 Health care costsare expected to skyrocket, complicated by rising unemployment and the increase in the numberof uninsured, aging and chronically ill.Chronic disease accounts for three-fourths of the more than $2 trillion spent on health careyearly in the U.S. Driving these costs are diabetes, heart disease and other obesity-relatedillnesses. 20 Drugs to treat these conditions comprised more than 40 percent of all prescriptionsacross our book of business in 2008. To gain control over total health care costs, plan sponsorsmust address these common chronic conditions. Our strategic pharmacy approach offerssolutions for managing these drugs in the context of total member health. (Turn to page 25for details on our approach.)Specialty Medications. Focused Response.Specialty drug costs are growing at more than twice the rate of traditional drugs. Within ourbook of business, specialty costs grew 9.1 percent from 2007 to 2008. Niche drugs and genetictherapies dominate new drug development. Managing the cost of these drugs will soon becomethe primary focus of pharmacy management. Now, more than ever, a focused approach toSpecialty management is critical. Triessent ® , our holistic approach to Specialty pharmacy,delivers more health at a better price. We optimize adherence through a system of premium,high-touch member service protocols. Our coordinated pharmacy management tools help plansponsors track and manage Specialty drug costs across both the pharmacy and medical benefit.Specialty Medications15.4% Of commercial book-of-business spend1.1% Of total Rxs9.1% Increase in PMPM cost from 2007$75 Average ingredient cost per day (versus $2.50 for traditional drugs)See page 48© Prime Therapeutics 2009 Drug Trend Insights11