Subsequent week, Drug Channels Institute (DCI) will launch our 2024 Financial Report on U.S. Pharmacies and Pharmacy Profit Managers. It’s the fifteenth version of our well-liked and complete examination of the complete U.S. drug pricing, reimbursement, and meting out system.
For 2023, DCI estimates that U.S. prescription meting out revenues reached $621 billion in 2023, pushed by accelerating GLP-1 prescriptions and an increasing post-pandemic market. The desk under—certainly one of 262 in our new report—offers DCI’s first have a look at the 15 largest organizations that battled for these revenues.
For a sneak peek on the full report, click on right here to obtain our free report overview (together with key business tendencies, the desk of contents, and a listing of displays). We’re providing particular discounted pricing if you happen to order earlier than April 7, 2024.
How will probably the most consequential change in federal drug pricing coverage have an effect on the most important pharmacies and PBMs? Discover out at my upcoming stay video webinar, Drug Channel Implications of the Inflation Discount Act, on April 5, 2024, from 12:00 p.m. to 1:30 p.m. ET. Click on right here to study extra and join.
The desk under exhibits DCI’s estimates of the most important pharmacies ranked by whole prescription meting out revenues for 2023, excluding revenues from the administration of COVID-19 vaccines. For vital details about these figures, please see the desk’s footnotes and the Notes for Nerds part under.
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Observations on these figures:
- The highest seven corporations working pharmacies—CVS Well being, Walgreens Boots Alliance, Cigna, UnitedHealth Group, Walmart, Kroger, and Ceremony Assist—accounted for two-thirds of U.S. prescription meting out revenues in 2023. The highest 15 pharmacies accounted for about three-quarters of whole meting out revenues from retail, mail, long-term care, and specialty pharmacies.
- Specific Scripts, which remained the third-largest meting out pharmacy, had a direct influence on revenues at two different high 15 corporations:
- Walgreens Boots Alliance’s AllianceRx Walgreens Pharmacy (ARxWP) continued to lose gross sales to Specific Scripts’ Accredo specialty pharmacy enterprise. This was a consequence of the meltdown of the Prime Therapeutics/Walgreens relationship. A majority of Prime’s plan sponsor purchasers have shifted specialty success to Specific Scripts. These misplaced purchasers diminished ARxWP’s revenues by greater than $11 billion over the previous few years.
- In 2022, Kroger terminated its pharmacy supplier settlement with Specific Scripts. We estimate that Kroger’s exit from the Specific Scripts pharmacy community diminished the grocery store’s annual retail and specialty prescription revenues by greater than $2.0 billion for 2023. To beat a few of these restrictions, Kroger has introduced direct pharmacy community agreements with such payers as Prime Therapeutics, Medical Mutual, and Centene.
We focus on different market modifications and acquisitions that affected the 2023 revenues and progress charges for the most important corporations within the following sections of our new report: Part 2.3.3., Part 3.3.2., Part 3.3.4, and Part 5.2.2.
- In line with prior years’ evaluation, 5 of the most important pharmacies have been central fill mail and specialty pharmacies owned by vertically built-in organizations that additionally personal a pharmacy profit supervisor (PBM): Caremark (CVS Well being), Specific Scripts (Cigna), Envolve Well being (Centene), CenterWell (Humana), and Optum Rx (UnitedHealth Group). We estimate that specialty medication accounted for a majority of prescription revenues at these pharmacies.
- Within the report’s Part 12.3.1., we replace our evaluation of vertical integration amongst insurers, PBMs, specialty pharmacies, and suppliers inside U.S. drug channels. Exhibit 254 updates DCI’s notorious vertical integration chart.
The income figures within the chart above mirror mixed meting out revenues from all entities inside these organizations. Web page vii of the 2024 report overview offers a useful matrix summarizing the varied roles that these corporations play within the drug channel.
Varied introduced developments will alter the most important 15 pharmacies for 2024. These embody:
- In January 2024, Specific Scripts started a five-year settlement to handle pharmacy advantages for about 20 million Centene beneficiaries. CVS Caremark had beforehand supplied these companies to Centene’s pharmacy profit administration enterprise.
- The last word final result of Ceremony Assist’s chapter stays unclear. In 2024, MedImpact accomplished its buy of Ceremony Assist’s Elixir Options PBM enterprise, which operates specialty and mail pharmacies.
- Elevance Well being’s CarelonRx has introduced a number of investments and initiatives that may develop its inner meting out capabilities and scale back its dependence on CVS Well being. These actions embody its acquisitions of BioPlus Specialty Pharmacy and Paragon Healthcare, the launch of CarelonRx Pharmacy, and its investments within the DomaniRx PBM claims administration platform.
DCI’s new report exhibits that the shakeout of retail pharmacies accelerated in 2023, as acquisitions elevated and bigger corporations diminished the variety of U.S. pharmacy areas. The variety of U.S. pharmacy areas throughout all codecs has begun trending downward. Because the African proverb says: “When elephants combat, it’s the grass that suffers.”
NOTES FOR NERDS
Our estimated prescription income information might not correspond with figures from different public sources for the next causes:
- Now we have computed or estimated the figures on a calendar-year foundation. The fiscal years for a lot of public retail corporations don’t correspond to calendar years.
- Many corporations don’t report prescription revenues. Now we have subsequently used varied strategies and sources to estimate the information. The place related, we now have adjusted beforehand reported figures primarily based on new disclosures of prescription revenues.
- As famous within the footnotes to the desk above, we now have made varied changes to account for the professional forma influence of mergers and acquisitions in addition to sure shopper transitions among the many largest PBMs. 12 months-over-year progress charges have been additionally computed primarily based on the prior yr’s professional forma revenues. Professional forma revenues are computed primarily based on the yr through which an acquisition was accomplished.
- Until in any other case famous, the figures for prescription meting out revenues and income in our new report (together with the desk above) exclude COVID-19 vaccinations that have been administered in retail pharmacies. This omission permits extra acceptable comparisons with earlier years’ figures. DCI estimates that whole retail pharmacy business revenues from administering COVID-19 vaccines have been lower than $2 billion in 2023.
One other reminder: prescription meting out revenues should not equal to internet spending on outpatient prescribed drugs (reported by the Facilities for Medicare & Medicaid Companies’ Nationwide Well being Expenditures information) and “non-discounted spending” or “invoice-price spending” (reported by IQVIA).
CORRECTION: Within the authentic model of this text, we misstated PANTHERx’s 2023 revenues as $2.5 billion, slightly than the precise determine of $3.6 billion. We apologize for the error.
