Americans spent $98 billion out of pocket on prescription drugs in 2024, marking a cumulative 25% increase over five years, according to an annual report from analytics firm IQVIA.
Why it matters: Lowering prescription drug costs remains a priority for both Democrats and Republicans.
- The Biden administration led Congress in passing a landmark legislative package to negotiate select drug prices for seniors and redesign Medicare Part D. President Trump is continuing the focus, and recently signed an executive order aimed at further cutting drug prices.
What they found: Net spending on medicine rose 11.4% in 2024 to $487 billion. Prescription costs on average were flat compared with 2023, but there was greater use of medicines with significant clinical benefits, IQVIA said.
- More than one-quarter of new prescriptions were not filled in 2024, mostly because they aren’t covered by insurers.
- Payer rejections may be driven by factors like prior authorization requirements or formulary decisions, but nearly half of those rejections are overcome either by the patient switching to a secondary insurer, paying cash, or adding a coupon, per IQVIA.
- Looking ahead, total net spending on medications in the U.S. will exceed $600 billion by 2029, with obesity and oncology drugs driving growth, IQVIA estimates.
Zoom out: Prescription medicine use increased 1.7% last year, the report found.
- The number of retail and long-term care prescriptions reached 7.1 billion, a nearly 1 billion increase since 2019. But growth in dispensed prescriptions in 2024 was slower than during the previous two years.
Stunning stats: Prescription opioid use fell to the lowest level since 1999, and overdose deaths decreased 29% in 2024.
- Separately, vaccination levels are between 15% to 39% lower than in 2019, depending on the vaccine.
- An investor note on the report from Leerink Partners said Health and Human Services Secretary Robert F. Kennedy Jr.’s agenda may further depress vaccine uptake.