NCPA - National Center for Policy Analysis

Spending On Prescription Drugs Jumped In 2000

May 8, 2001

A new report says spending on prescription drugs in the United States rose 19 percent last year. The National Institute for Health Care Management, which compiled the study, says that just 23 medications accounted for about half of the increased spending.

  • Sales of antiarthritic, oral diabetes, narcotic painkiller, antiseizure and antipsychotic medications grew the most -- with sales in each category increasing in excess of 30 percent.
  • American consumers bought $131.9 billion worth of prescription drugs in 2000 -- up from $111.1 billion in 1999.
  • Prescription volume for the 50 best-selling drugs surged by 18.6 percent -- compared with a 3.4 percent increase for prescription drugs overall.
  • There was evidence of a large-scale substitution of newer treatments for older and cheaper ones.

The drug-industry group PhRMA, the Pharmaceutical Research and Manufacturers of America, quarreled with aspects of the study and said that a rise in prescription drug use reduces the need for surgery and hospital stays.

Source: Sarah Lueck, "Spending on Prescription Drugs Rose 19%," Wall Street Journal, May 8, 2001.

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