The cost of prescription drugs and biologics is one of largest health care expenses that employers incur. Here are some interesting facts to consider when planning your business’ health care budget:

  • The National Drug Trend in 2010 was +2.8%. The average national spend per claimant was $757. In Ontario, the average was $764 per claimant.
  • There was an average of 12.3 prescriptions per claimant in 2010, representing an increase of 2.6% over 2009.
  • Overall cost per script (prescription) increased +0.2% in 2010. Drug reforms attributed to a -0.3% decrease in drug costs, but dispensing fees increased by +3.2% for an overall increase of 0.2%.
  • General price reductions, due to provincial drug reforms, caused downward pressure on drug costs. In Ontario, weighted price inflation was +0.22% for brand name drugs and +1.9% for generics.
  • Of the $757 average drug cost spend 825% was attributable to traditional drug therapies which had an average drug cost of $51 per script.

Specialty (Biologics) Drugs accounted for 17.5% of the average spending per claimant in 2010. The average cost per prescription was $1,185. Additionally the trend on those drugs was +13.2% versus +0.8% for traditional drugs.

Specialty drugs are defined as injectable and non injectable products used to treat specialized medical conditions. They are characterized by having;

  • Limited or exclusive product availability
  • Intensive patient training and compliance assistance
  • Cost >$500 for 30 day supply
  • Require specialized handling and administration
  • Involve intensive clinical monitoring

The top 5 classes of specialty drugs accounted for 76% of overall specialty drug costs. The leading specialty classes in 2010 were as follows:

  • Rheumatoid Arthritis  38.9%
  • Multiple Sclerosis  12.6%
  • Anti Cancer  10.2%
  • HIV/Aids  7.5%
  • Blood Disorders  6.3%

[1] Source – ESI Canada 2010 Drug Trend Report

For the past 18 years, Chris Pryce of Human Capital Benefits has been advising employers on all aspects of managing employee benefits programs and related products. If you have any questions, you can contact Chris at 416.924.8280 or by email at