A look forward: Five trends PBMs should expect in 2025
As 2025 begins, PBMs should not be surprised to see many of the same trends they encountered last year. What’s ahead for PBMs?
5. More cell and gene therapies (CGT) hitting the market
The first CGT was approved in the U.S. in 2017, and the area continues to grow. In 2023, there were seven new CGT approved while in just the first half of 2024, there were eight new ones approved.
As of November 21, 2024, there were 41 approved CGT. Approximately 10 to 12 new CGT products are expected to be approved each year as of 2025. And there are over 4,000 CGT in development.
CGT are known for having high price tags. The most expensive one is Lenmeldy™, which costs $4.25 million. Approved in 2024, it treats metachromatic leukodystrophy, a rare nerve disorder.
More and more CGT on the market could cause budget pressures and certain constraints on payers along with financial concerns about providing them.
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4. Potential regulatory changes
The Federal Trade Commission released a lengthy report on PBMs in the summer of 2024. The report covered numerous topics facing the industry, including consolidation, pharmacy practices, and vertical integration.
A number of bills have been introduced in Congress relating to PBMs. Most recently, in December 2024, the Patients Before Monopolies (PBM) Act was introduced in the Senate. This act calls for health insurance companies owning health insurers or PBMs to sell their pharmacy assets within three years. A related bill was presented in the House of Representatives.
There has also been PBM legislation on the state level. For example, a new law went into effect in Louisiana on January 1 that prohibits PBMs from reimbursing pharmacies or pharmacists less than the acquisition cost for the drug, device, or service. In Vermont, a bill relating to licensing and regulation of PBMs was signed into law in May 2024 with some provisions effective as of January 1. And an Idaho bill related to PBM transparency went into effect on January 1.
With a new federal administration taking office later this month, there could be more changes and legislation regarding PBMs.
3. Increased use of biosimilars
As of October 2024, there are 62 biosimilars approved by the Food and Drug Administration (FDA). In 2024 alone, 17 new biosimilars were approved. Several of these were the first to treat specific conditions.
The first biosimilars were approved to treat four different disease states. Five biosimilars were approved for Eylea®, which treats wet age-related macular degeneration, diabetic retinopathy, diabetic macular edema, and macular edema following retinal vein occlusion. Four biosimilars were approved for Stelara®, which treats Crohn’s disease, ulcerative colitis, plaque psoriasis, and psoriatic arthritis. Two biosimilars were approved for Soliris®, which treats neuromyelitis optica spectrum disorder. One biosimilar was approved for Prolia®, which treats bone metastases from breast, prostate, and other solid tumors and multiple myeloma.
Biosimilars were increasingly being used in 2024, and that trend is expected to continue in 2025. For example, last year, many PBMs started putting biosimilars on their formularies in place of Humira®. An additional biosimilar for Humira was approved in 2024, bringing the total number of biosimilars for that drug to 10.
The market size for biosimilars has consistently been going up. In 2023, global market size for biosimilars was $29.45 billion, and in 2024, it was expected to be $34.66 billion. For 2025, the number is estimated to be around $40.8 billion.
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2. GLP-1s domination
GLP1s will continue to dominate the news this year, much as they did in 2024. More and more people are using GLP1s for a variety of conditions. Utilization for diabetes increased by 15.6% in 2024 compared to 2023, and utilization for weight loss increased by 78%. Since the beginning of 2024, prescriptions for Wegovy® and Zepbound® have gone up by three digits— Wegovy prescriptions rose by more than 100% and Zepbound prescriptions by more than 300%. GLP1s are now being used to treat other conditions, too. One was approved to treat cardiovascular disease in 2024, and others are being studied for the treatment of substance use disorder, sleep apnea, and Alzheimer’s disease.
As GLP1s are prescribed to treat more conditions, more people could begin taking them. There are now 27 GLP1s in development.
GLP1s were expected to be the number 1 selling drug in 2024, taking the spot from PD-1 inhibitors, which are used to treat cancer. GLP-1 market size was expected to be approximately $46.7 billion in 2024. This year, that number could reach $56.62 billion.
According to findings from Willis Towers Watson’s 2024 Best Practices in Healthcare Survey, 52% of employers offered coverage of GLP-1s for obesity treatment in 2024. That number is up 14 percentage points from 2023. An additional 12% of employers are “planning or considering adding” GLP-1s over the next two years.
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- A look back: Top 5 PBM 2024 market trends
- One size does not fit all: GLP-1 weight loss coverage options for three companies
- GLP-1: How to Decide What is Best for Your Plan
1. Rising drug prices
Drug prices went up in 2024 and are expected to go up again this year. One initial estimate shows that drug costs will increase by 3.8% in 2025. Another estimate says that those costs could increase by 8%.
According to findings from Willis Towers Watson’s 2024 Best Practices in Healthcare Survey, “The cost of prescription drugs and pharmaceuticals has been growing at twice the rate of any other healthcare service category over the past decade.”
Greater use of glucagon-like peptide-1 agonists (GLP-1s) and cell and gene therapies (CGT), including chimeric antigen receptor T-cell (CAR-T) therapies, is driving the increase. The cost for GLP-1s before insurance, rebates, or other discounts can be as high as $1349 a month. CGT, which treat many diseases including genetic disorders and cancers, are usually extremely expensive. The cost of gene therapy (per dose) averages between $1 million and $2 million. The average cost of CAR-T cell therapy is between $500,000 and $1 million.
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References
- Anderson, Maia. Drug cost inflation to rise 3.8% in 2025, report shows. Health Brew. August 1, 2024.
- Lutton, Logan. Employers Predict Drug Prices Will Increase in 2025, Survey Shows. Managed Healthcare Executive. September 20, 2024.
- Klein, Hayden E. Most Insured Adults Still Have to Pay at Least Part of the Cost of GLP-1 Drugs. American Journal of Managed Care. May 16, 2024.
- Cell and Gene Therapy Manufacturing Costs Limiting Access. Genetic Engineering & Biotechnology News. February 21, 2023.
- Mayer Robinson, Kara. Navigating the Financial Aspects of CAR-T Cell Therapy. WebMD. June 26, 2024.
- Kim Constantino, Annika. Prescription fills for weight loss drugs Zepbound and Wegovy more than doubled in 2024, GoodRx says. CNBC. December 5, 2024.
- Lovelace, Jr., Berkeley. Beyond Ozempic: New GLP-1 drugs promise weight loss and health benefits. NBC News. June 23, 2024.
- GLP-1 Analogues Market Outlook: Rapid Growth at 21.3% CAGR to Surpass USD 322.85 Billion by 2034. Polaris Market Research. November 19, 2024.
- Employers seek more value as they face historically high medical inflations. Findings from WTW’s 2024 Best Practices in Healthcare Survey. Willis Towers Watson. September 24, 2024.
- What biosimilars have been approved in the United States? Drugs.com. October 17, 2024.
- Biosimilars Market Size Poised to Hit USD 150.26 Billion by 2033. BioSpace. June 17, 2024.
- Pifer, Rebecca. New bipartisan legislation would force insurers, PBMs to sell pharmacy businesses. HealthcareDive. December 11, 2024.
- Q3 2024 State and Federal Regulatory and Legislative Activity Update. CarelonRx. August 30, 2024.
- Regulations to watch: Fall 2024. Optum. September 12, 2024.
- PBM reform: A closer look at state legislation this year. Rightway. July 10, 2024.
- Approved Cellular and Gene Therapy Products. Food and Drug Administration. November 21, 2024.
- Gene therapies require advanced capabilities to succeed after approval. PwC.
- Gene, Cell, + RNA Therapy Landscape Report. Q1 2024 Quarterly Data Report. April 1, 2024.
- Regalado, Antonio. There is a new most expensive drug in the world. Price tag: $4.25 million. MIT Technology Review. March 20, 2024.
- Phares, Sharon, Trusheim, Mark, Emond, Sarah K., and Pearson, Steven D. Managing the Challenges of Paying for Gene Therapy: Strategies for Market Action and Policy Reform. Institute for Clinical and Economic Review. April 23, 2024.
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