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Why Costs are Rising

Prescription Drugs

Nationally, spending on retail prescription drug sales reached $184 billion in 2003.1 The top 50 best selling drugs accounted for 43% of sales.2 This increasing demand for high-priced, brand-name, pharmaceutical drugs has a significant impact on the cost of health care in America.

What fuels rising prescription costs?

  • An increase in the number of written prescriptions ( 20%)

  • Price increases from pharmaceutical companies and a sales shift to higher
    cost drugs ( 80%)

Choose a section of the pie chart below to read more about these driving factors.

Factors Driving the Rise of Pharmaceutical Costs Pie Chart - 39% Factors Driving the Rise of Pharmaceutical Costs Pie Chart - 39% Factors Driving the Rise of Pharmaceutical Costs Pie Chart - 80% Factors Driving the Rise of Pharmaceutical Costs Pie Chart - 80% Factors Driving the Rise of Pharmaceutical Costs Pie Chart - 80%
Factors Driving the Rise of Pharmaceutical Costs Pie Chart - 39%
Factors Driving the Rise of Pharmaceutical Costs Pie Chart - 80% Factors Driving the Rise of Pharmaceutical Costs Pie Chart - 80%
Factors Driving the Rise of Pharmaceutical Costs Pie Chart - 80%

Direct-to-consumer advertising is having a major effect in all three of these areas. Studies report that nearly 1/3 of all Americans have talked to their doctor about a drug they've seen advertised. In 2002, Americans spent $80 billion on drugs that didn't exist just five years ago.

1 CMS; National Health Expenditures Table 2; 1998-2003
2 Source: NIHCM Foundation, 2004

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