Spending on U.S. pharmaceuticals

Spending on pharmaceuticals in the United States grew at its smallest level in years in 2010, according to a report by the IMS Institute for Healthcare Informatics. Pharmaceutical spending increased 2.3% in 2010 compared to 5.1% in 2009. Generics dominated the pharmaceutical market in 2010 making up 78% of total market share compared to 63% in 2006. Of the top 25 drugs by volume, only three were brand-name products: atorvastatin (Lipitor), clopidogrel (Plavix), and montelukast (Singulair). By spending dollars, however, Lipitor was the top grossing product at $7.2 billion in 2010, down from $7.6 billion in 2009. Esomeprazole (Nexium) was second at $6.3 billion, while Plavix ranked third at $6.1 billion. The domination of generics is of major concern to the pharmaceutical industry since there are few new drugs in the development pipeline and several high-profile drugs are due to lose protection soon. Foremost among these is Pfizer's Lipitor. Pfizer has been battling to maintain its patent protection, but generic manufacturer Watson Pharmaceuticals is expected to introduce the first generic atorvastatin in November of this year. Likewise, Merck's Singulair will likely lose its patent protection next year. The economy also has played a role in the decrease in pharmaceutical spending as the total volume of medicines consumed decreased 0.5% in 2010 along with a decrease in the number of doctor office visits of 4.2%. This extends a decline that began in mid 2009 — likely due to higher unemployment and rising health care costs.