US Prescription Sales Grew 5.1% in 2009 to $300.3 billion, Estimates IMS Health

Pharmaceutical Commerce, Pharmaceutical Commerce - April 2010,

Generics are now 75% of dispensed prescriptions, with generics up 5.9% in 2009 and branded products down 7.6%

IMS Health’s annual summary of the US drug market shows a higher-than-normal increase in 2009, at least compared to the two previous years, when the annual sales grew 1.8% (2008) and 3.8% (2007). But the 5.1% increase is only just three percentage points over the increase in dispensed prescriptions, indicating that overall price inflation remains low. (IMS Health notes that it periodically revises its estimates, and has changed the 2008 and earlier figures from what was reported last year; it also revised sub-category figures from April 1, the day of the initial announcement, to those reported on April 6.)

“In 2009, demand for pharmaceuticals proved stronger than in the prior two years, yet remained at historically low levels,” says IMS’ Murray Aitken, SVP. “While the 32 innovative products launched last year brought important new treatment options to patients . . . they drove only a limited increase in drug spending.”

Biggest get bigger

IMS Health tracks retail sales per channel, and the picture here is that while change is only gradual, it is continuing in the same direction as the past several years: chain pharmacies and mail service up; independent pharmacies down, while foodstores, clinics and hospitals held fairly steady. Chains’ sales volume grew 5.8%, to $105.5 billion, and represented 35.1% of the overall market. Mail service grew even faster—10.8%, to $51.5 billion—representing 17.1% of the overall market. Indpendents’ sales grew 1.1%, to $37.3 billion, but they continue to fall behind as a fraction of the overall market, with their sales dropping from 12.9% of the overall market in 2008 to 12.4% in 2009.

Chains also stretched their dominance as location of where prescriptions are filled, accounting for 54.3% of 2009’s 3.922 billion prescriptions. Independents filled 19.2% of 2009’s prescriptions, down from 20.0% the year before. Surprisingly, though, mail service’s volume also declined, from 6.3% of prescriptions filled in 2008 to 6.1% in 2009. Mail service, via its connection with PBMs, is known for aggressively promoting use of generics; if that remains the case, the conclusion could be that they have been equally aggressive in high-priced specialty pharmaceuticals (which, as a category of drugs, IMS Health says grew by 7.5% last year and now comprise 21% of US market value).

Other markers of note:

  • The top five drug classes (in order, by sales) are antipsychotics, lipid regulators, proton pump inhibitors, antidepressants and angiotensin II antagonists. By volume dispensed, the top five are lipid regulators, codeine & combinations, antidepressants, ACE inhibitors and beta blockers.
  • The total number of generic prescriptions dispensed grew by 5.9%, while the number of branded prescriptions dispensed dropped by 7.6%.
  • Purely on the basis of drug sales, the top five pharma companies (in order) are Pfizer, Merck, AstraZeneca, GSK and Roche. Johnson & Johnson dropped from fifth in 2008 to eighth in 2009, and GSK and Roche have traded places.