1. Peterson-Kaiser Health System Tracker What are the recent and forecasted trends in prescription drug spending?

2. Peterson-Kaiser Health System Tracker Source: Kaiser Family Foundation analysis of National Health Expenditure (NHE) Historical (1960-2014) and Projected (2014-2024) data from Centers for Medicare and Medicaid Services, Office of the Actuary, National Health Statistics Group (Accessed on December 7, 2015) Note: 2014 to 2015 percent changes are calculated using 2014 and 2015 projected amounts. Growth in prescription spending had slowed, but increased rapidly in 2014 and 2015 Average annual growth rate of prescription drug spending per capita for 1970’s – 1990’s; Annual change in actual prescription drug spending per capita 2000 – 2014 and projected prescription drug spending per capita 2015 - 2024

3. Peterson-Kaiser Health System Tracker Source: Kaiser Family Foundation analysis of National Health Expenditure (NHE) Historical (1960-2014) and Projected (2014-2024) data from Centers for Medicare and Medicaid Services, Office of the Actuary, National Health Statistics Group (Accessed on December 7, 2015) Estimates suggest that Rx drugs will represent a larger portion of overall health spending beginning in 2014 Percent of total health spending that went toward prescription drugs, 2000 – 2014 Percent of projected health spending that is projected to go toward prescription drugs, 2015 - 2024

4. Peterson-Kaiser Health System Tracker Source: Kaiser Family Foundation analysis of National Health Expenditure (NHE) Historical (1960-2014) and Projected (2014-2024) data from Centers for Medicare and Medicaid Services, Office of the Actuary, National Health Statistics Group (Accessed on December 7, 2015) Out-of-pocket spending on hospital care fell in 2014, but grew for Rx drugs Actual per capita out-of-pocket health spending 2000 – 2014, and projected per capita out-of-pocket health spending (2015 – 2024) on hospitals, physicians and clinics, and retail prescription drugs

5. Peterson-Kaiser Health System Tracker Source: Kaiser Family Foundation Health Tracking Poll (conducted Aug 6 – 11, 2015) Most people taking Rx drugs say they can afford their treatment, but about 1 in 4 have a difficult time affording their medicine Among those who are currently taking Rx medicine, percent who report ease or difficulty affording the cost of their prescription medications

6. Peterson-Kaiser Health System Tracker Source: Kaiser Family Foundation analysis of National Health Expenditure (NHE) Historical (1960-2014) and Projected (2014-2024) data from Centers for Medicare and Medicaid Services, Office of the Actuary, National Health Statistics Group (Accessed on December 7, 2015) Out-of-pocket costs for Rx drugs are expected to increase, but will likely represent a smaller portion of overall Rx spending Percent of total Rx spending 2000 – 2014, and percent of projected Rx spending (2015 – 2024) by out-of-pocket vs. private insurance and Medicare

7. Peterson-Kaiser Health System Tracker Source: IMS Institute for Healthcare Informatics. Medicines Use and Spending in the U.S. A Review of 2015 and Outlook to 2020. Drug spending growth since 2014 has largely been due to new brands, high prices for existing drugs, and fewer patent expiries Contribution to growth in drug spending, by spending growth drivers, in $US billions, 2010 -2014

8. Peterson-Kaiser Health System Tracker Source: Express Scripts 2015 Drug Trend Report and Year in Review. Available at http://lab.express-scripts.com/lab/drug-trend-report Costly new specialty drugs are a major driver of increased health spending Express Scripts drug trend by therapy class, 2006 -2015

9. Peterson-Kaiser Health System Tracker Source: PwC Health Research Institute Since 2010, more specialty drugs have been approved than traditional drugs Number of approved drugs, by therapy class, 2005 -2014

10. Peterson-Kaiser Health System Tracker Source: Express Scripts 2015 Drug Trend Report. Available at http://lab.express-scripts.com/lab/drug-trend-report Medications for inflammatory conditions and multiple sclerosis topped specialty drug spending in 2015 Express Scripts per-member-per-year spending, top 10 specialty therapy class drugs, 2015

11. Peterson-Kaiser Health System Tracker Source: Express Scripts 2015 Drug Trend Report. Available at http://lab.express-scripts.com/lab/drug-trend-report Diabetes medicines topped traditional drug spending in 2015, and were nearly double the second leading category Express Scripts per-member-per-year spending on top 10 traditional therapy class drugs, 2015

12. Peterson-Kaiser Health System Tracker Source: Source: Kaiser Family Foundation analysis of Bureau of Economic Analysis data Growth in price and utilization of pharmaceuticals has varied over the past 2 decades Annual percent change in price and quantity indexes of pharmaceutical and other medical products, index numbers 2009=100

13. Peterson-Kaiser Health System Tracker Source: Express Scripts 2014 Drug Trend Report and Year in Review. Available at http://lab.express-scripts.com/drug-trend-report/trend-drivers/the- express-scripts-prescription-price-index Generic drug prices have declined while branded drug prices have nearly doubled in price Express Scripts Prescription Price Index

14. Peterson-Kaiser Health System Tracker Source: International Federation of Health Plans Notes: U.S. average prices are calculated using commercial claims data from Truven MarketScan Research databases. Methods and sources for comparable countries can be found here: http://www.ifhp.com/1404121 The average price of Celebrex in the U.S. is about 63% higher than in Switzerland Average Price, 2013

15. Peterson-Kaiser Health System Tracker The average price of Nexium in the U.S. is almost 3 times more than the average price in Switzerland Average Price, 2013 Source: International Federation of Health Plans Notes: U.S. average prices are calculated using commercial claims data from Truven MarketScan Research databases. Methods and sources for comparable countries can be found here: http://www.ifhp.com/1404121

16. Peterson-Kaiser Health System Tracker The average price of Humira is about 15% higher in the U.S. than in Canada Average Price, 2013 Source: International Federation of Health Plans Notes: U.S. average prices are calculated using commercial claims data from Truven MarketScan Research databases. Methods and sources for comparable countries can be found here: http://www.ifhp.com/1404121

17. Peterson-Kaiser Health System Tracker The average price of Enbrel in the U.S. is about 35% higher than in Canada Average Price, 2013 Source: International Federation of Health Plans Notes: U.S. average prices are calculated using commercial claims data from Truven MarketScan Research databases. Methods and sources for comparable countries can be found here: http://www.ifhp.com/1404121

18. Peterson-Kaiser Health System Tracker The average price of Copaxone in the U.S. is almost 3 times the average price in Switzerland Average Price, 2013 Source: International Federation of Health Plans Notes: U.S. average prices are calculated using commercial claims data from Truven MarketScan Research databases. Methods and sources for comparable countries can be found here: http://www.ifhp.com/1404121

19. Peterson-Kaiser Health System Tracker The average price of Cymbalta in the U.S. is 76% more than the average price in Canada Average Price, 2013 Source: International Federation of Health Plans Notes: U.S. average prices are calculated using commercial claims data from Truven MarketScan Research databases. Methods and sources for comparable countries can be found here: http://www.ifhp.com/1404121

20. Peterson-Kaiser Health System Tracker The average price of Gleevec in the U.S. is 71% more than the average price in Switzerland Average Price, 2013 Source: International Federation of Health Plans Notes: U.S. average prices are calculated using commercial claims data from Truven MarketScan Research databases. Methods and sources for comparable countries can be found here: http://www.ifhp.com/1404121

21. Peterson-Kaiser Health System Tracker The average price of Gilenya in the U.S. is more than double the average price in Canada Average Price, 2013 Source: International Federation of Health Plans Notes: U.S. average prices are calculated using commercial claims data from Truven MarketScan Research databases. Methods and sources for comparable countries can be found here: http://www.ifhp.com/1404121

22. Peterson-Kaiser Health System Tracker Drugs count for a bigger share of health spending than many think Retail drugs as a share of national health spending and as a share of employer health benefits, 2013 Source: Kaiser Family Foundation analysis of data from the Centers for Medicare and Medicaid Services and Truven Health Analytics

23. Peterson-Kaiser Health System Tracker Source: National Health Expenditure (NHE) data from Centers for Medicare and Medicaid Services, Office of the Actuary, National Health Statistics Group Medicare has become a major payer for prescription drugs Distribution of total national health expenditures on retail prescription drugs, by payer, 2004 and 2014

24. Peterson-Kaiser Health System Tracker Source: Kaiser Family Foundation Health Tracking Poll (conducted August 6-11, 2015) Most Americans favor action to keep drug prices down Percent who say they favor each of the following in keeping prescription drug costs down