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Pharmaceutical Expenditure And Policies: Past Trends And Future Challenges

Author

Listed:
  • Annalisa Belloni

    (OECD)

  • David Morgan

    (OECD)

  • Valérie Paris

    (OECD)

Abstract

Across OECD countries, pharmaceutical spending reached around USD 800 billion in 2013, accounting for about 20% of total health spending on average when pharmaceutical consumption in hospital is added to the purchase of pharmaceutical drugs in the retail sector. This paper looks at recent trends in pharmaceutical spending across OECD countries. It examines the drivers of recent spending trends, highlighting differences across therapeutic classes. While the consumption of medicines continues to increase and to push pharmaceutical spending up, cost-containment policies and patent expiries of a number of top-selling products have exerted downward pressure on pharmaceutical expenditures in recent years. This resulted in a slower pace of growth over the past decade. The paper then looks at emerging challenges for policy makers in the management of pharmaceutical spending. The proliferation of high-cost specialty medicines will be a major driver of health spending growth in the coming years. While some of these medicines bring great benefits to patients, others provide only marginal improvements. This challenges the efficiency of pharmaceutical spending. Les dépenses pharmaceutiques ont atteint environ 800 milliards USD en 2013 dans les pays de l’OCDE, soit environ 20 % en moyenne des dépenses de santé totales lorsque l’on ajoute la consommation hospitalière de produits pharmaceutiques à l’achat de médicaments au détail. Ce document examine les tendances récentes en matière de dépenses pharmaceutiques dans les pays de l’OCDE. Il examine les déterminants de l’évolution récente des dépenses, en soulignant les différences entre les classes de médicaments. Alors que la consommation de médicaments continue d’augmenter et de pousser à la hausse les dépenses pharmaceutiques, les politiques de maîtrise des coûts et l'expiration des brevets d'un certain nombre de produits les plus vendus ont exercé une pression à la baisse sur ces dépenses au cours des dernières années. Cela a entraîné un ralentissement de la croissance au cours de la dernière décennie. Le document se penche ensuite sur les défis émergents pour les décideurs politiques en ce qui concerne la gestion des dépenses pharmaceutiques. La prolifération de médicaments de spécialité à coût élevé sera un moteur important de la croissance des dépenses de santé dans les années à venir. Alors que certains de ces médicaments apportent de grands avantages aux patients, d'autres ne fournissent que des améliorations marginales. Cela remet en question l'efficacité des dépenses pharmaceutiques.

Suggested Citation

  • Annalisa Belloni & David Morgan & Valérie Paris, 2016. "Pharmaceutical Expenditure And Policies: Past Trends And Future Challenges," OECD Health Working Papers 87, OECD Publishing.
  • Handle: RePEc:oec:elsaad:87-en
    DOI: 10.1787/5jm0q1f4cdq7-en
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    Cited by:

    1. Wettstein, Dominik J. & Boes, Stefan, 2022. "How value-based policy interventions influence price negotiations for new medicines: An experimental approach and initial evidence," Health Policy, Elsevier, vol. 126(2), pages 112-121.
    2. Kyung-Bok Son, 2020. "Is greater generic competition also linked to lower drug prices in South Korea?," Health Economics Review, Springer, vol. 10(1), pages 1-9, December.
    3. Meina Hua & Huajun Tang & Ivan Ka Wai Lai, 2017. "Game Theoretic Analysis of Pricing and Cooperative Advertising in a Reverse Supply Chain for Unwanted Medications in Households," Sustainability, MDPI, vol. 9(10), pages 1-31, October.
    4. Dominik J. Wettstein & Stefan Boes, 2020. "The impact of reimbursement negotiations on cost and availability of new pharmaceuticals: evidence from an online experiment," Health Economics Review, Springer, vol. 10(1), pages 1-15, December.
    5. Berger, Michael & Pock, Markus & Reiss, Miriam & Röhrling, Gerald & Czypionka, Thomas, 2023. "Exploring the effectiveness of demand-side retail pharmaceutical expenditure reforms: cross-country evidence from weighted-average least squares estimation," LSE Research Online Documents on Economics 116928, London School of Economics and Political Science, LSE Library.
    6. Pessino, Carola & Izquierdo, Alejandro & Vuletin, Guillermo, 2018. "Better Spending for Better Lives: How Latin America and the Caribbean Can Do More with Less," IDB Publications (Books), Inter-American Development Bank, number 9152, May.
    7. Simon Pol & Paula Rojas Garcia & Fernando Antoñanzas Villar & Maarten J. Postma & Antoinette D. I. Asselt, 2021. "Health-Economic Analyses of Diagnostics: Guidance on Design and Reporting," PharmacoEconomics, Springer, vol. 39(12), pages 1355-1363, December.
    8. Vola, Federico & Vinci, Bruna & Golinelli, Davide & Fantini, Maria Pia & Vainieri, Milena, 2020. "Harnessing pharmaceutical innovation for anti-cancer drugs: Some findings from the Italian regions," Health Policy, Elsevier, vol. 124(12), pages 1317-1324.
    9. Victoria Serra-Sastre & Simona Bianchi & Jorge Mestre-Ferrandiz & Phill O’Neill, 2021. "Does NICE influence the adoption and uptake of generics in the UK?," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 22(2), pages 229-242, March.
    10. Christensen, Elisabeth & Hirsch, Niels Christian & Andersen, Jonas Valbjørn & Ehlers, Lars Holger, 2022. "The analogue substitution model: Introducing competition in the absence of generic substitution in Danish hospitals," Health Policy, Elsevier, vol. 126(9), pages 844-852.
    11. Hammerschmidt, Thomas, 2022. "Sustainability of pharmaceutical expenditures in the German social health care system," Rosenheim Papers in Applied Economics and Business Sciences 4/2022, Rosenheim Technical University of Applied Sciences.
    12. Bence Kovács & Miklós Darida & Judit Simon, 2021. "Drugs Becoming Generics—The Impact of Genericization on the Market Performance of Antihypertensive Active Pharmaceutical Ingredients," IJERPH, MDPI, vol. 18(18), pages 1-20, September.
    13. Michael Berger & Markus Pock & Miriam Reiss & Gerald Röhrling & Thomas Czypionka, 2023. "Exploring the effectiveness of demand-side retail pharmaceutical expenditure reforms," International Journal of Health Economics and Management, Springer, vol. 23(1), pages 149-172, March.
    14. Lucia Mainero Rocca & Nunziata L’Episcopo & Andrea Gordiani & Matteo Vitali & Alessandro Staderini, 2021. "A ‘Dilute and Shoot’ Liquid Chromatography-Mass Spectrometry Method for Multiclass Drug Analysis in Pre-Cut Dried Blood Spots," IJERPH, MDPI, vol. 18(6), pages 1-20, March.
    15. Nazila Yousefi & Mahyar Polroudi Moghaddam & Gita Afsharmanesh & Farzad Peiravian, 2020. "Evaluation of efficiency enhancement in Iran Health Insurance Organization: a policy brief for pharmaceutical cost containment," International Journal of Health Planning and Management, Wiley Blackwell, vol. 35(6), pages 1503-1511, November.
    16. Manuel Martínez-Blanes & Francisco Javier Rondán-Cataluña & José Manuel Velarde-Gestera, 2020. "Indicators of Efficiency in the Pharmaceutical Management of a Public Health System," Administrative Sciences, MDPI, vol. 10(2), pages 1-19, May.
    17. Hye-Jae Lee & Euna Han & Hyero Kim, 2020. "Comparison of Utilization Trends between Biosimilars and Generics: Lessons from the Nationwide Claims Data in South Korea," Applied Health Economics and Health Policy, Springer, vol. 18(4), pages 557-566, August.
    18. Vogler, Sabine & Zimmermann, Nina & de Joncheere, Kees, 2016. "Policy interventions related to medicines: Survey of measures taken in European countries during 2010–2015," Health Policy, Elsevier, vol. 120(12), pages 1363-1377.
    19. Russo, Pierluigi & Carletto, Angelica & Németh, Gergely & Habl, Claudia, 2021. "Medicine price transparency and confidential managed-entry agreements in Europe: findings from the EURIPID survey," Health Policy, Elsevier, vol. 125(9), pages 1140-1145.
    20. Dominik J. Wettstein & Stefan Boes, 2019. "Effectiveness of National Pricing Policies for Patent-Protected Pharmaceuticals in the OECD: A Systematic Literature Review," Applied Health Economics and Health Policy, Springer, vol. 17(2), pages 143-162, April.
    21. Yael Rachamin & Christoph Jakob Ackermann & Oliver Senn & Thomas Grischott, 2021. "Price trends of reimbursed oncological drugs in Switzerland in 2005–2019: A descriptive analysis," PLOS ONE, Public Library of Science, vol. 16(11), pages 1-12, November.
    22. Serra-Sastre, Victoria & Bianchi, Simona & Mestre-Ferrandiz, Jorge & O’Neill, Phill, 2021. "Does NICE influence the adoption and uptake of generics in the UK?," LSE Research Online Documents on Economics 113639, London School of Economics and Political Science, LSE Library.

    More about this item

    Keywords

    dépenses pharmaceutiques; dépenses publiques de santé; health; pharmaceutical expenditure; pharmaceutical policy; politique pharmaceutique; public health; public health expenditures; santé;
    All these keywords.

    JEL classification:

    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health

    NEP fields

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