Prescription Drug Sales Growth Slows To Lowest Rate Since 1961

Main Category: Pharma Industry / Biotech Industry
Article Date: 14 Mar 2008 - 12:00 PDT

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Sales of U.S. prescription drugs grew 3.8% to $286.5 billion in 2007, the lowest increase since a 3.3% rise in 1961, according to the annual U.S. Pharmaceutical Market Performance Review released Wednesday by IMS Health, the AP/Houston Chronicle reports.

The report found that the slower growth rate likely was due in part to the rising popularity and availability of less expensive generic versions of brand-name medications that lost market exclusivity. According to the report, the volume of generic drugs grew by 10% as brand-name treatments with $17 billion in sales lost exclusivity. Generic drugs made up more than 67% of all prescription drug sales in 2007. IMS also cited a decline in the number of new approved medications, growing concerns about drug safety and a marked rise in the number of consumer advisories and market withdrawals of medications as possible reasons for the slow sales growth.

The report estimates that FDA issued 68 major warnings in 2007, up from 58 in 2006 and 21 in 2003. Safety issues contributed to "significantly lower-than-expected sales" for prescription drugs that made up about 10% of the total prescription drug market, the report said.

Prescription drug sales grew by 8% in 2006 when the Medicare prescription drug benefit was introduced. The drug benefit accounted for about 19% of prescription drug sales in 2007, a slight increase over 2006, which is "reflective of a maturing program," the IMS report said, adding that 65% of seniors ages 65 and older are now covered under the program.

IMS projected prescription drug sales to increase by 3% to 6% annually through 2012 due to the growing population of aging baby boomers, improved access to medications through programs like the Medicare drug benefit and the increasing use of biotechnology and other products (AP/Houston Chronicle, 3/13).

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