New Analysis Examines State Impact of High-Cost Hepatitis C Drugs

California's recent initiatives to address the impact of high priced hepatitis C drugs could not have come at a better time, as a new analysis estimates that the state's projected specialty drug expenditure would be $4.77 billion in the next year alone.

California’s recent initiatives to address the impact of high priced hepatitis C drugs could not have come at a better time, as a new analysis estimates that the state’s projected specialty drug expenditure would be $4.77 billion in the next year alone.

The study, published by the California Association of Health Plans, found that medication prices could be as high as $94,000 per treatment, which in the last year has forced prescription spending for the disease to increase by 750%.

“With a host of potentially six-figure priced drugs due to hit the market this year, this report shows how just one new treatment can blow a hole in state and federal budgets,” Charles Bacchi, president and CEO of the California Association of Health Plans, said in a statement. “These findings illustrate that this pricing trend is not sustainable for our state, its taxpayers and our public programs.”

The report noted that even if just 5% of those consumers who are enrolled in state programs such as Medi-Cal receive discounted treatments, costs could range anywhere from $512 million to $921 million. As a result, the governor’s 2015-2016 budget is calling for $228 million in supplemental funding for high-priced hepatitis C medications; yet despite the state’s efforts, many believe this is only the beginning.

In addition to an estimation for the number of Californian’s receiving healthcare coverage through the state program, the analysis explains scale of cost estimates based upon varying scenarios for price discounts and for those obtaining treatment.

“These new drugs have great potential as effective treatments, but their price tags strain state budgets and stand in the way of patients’ ability to access treatments,” the authors wrote.

The report’s findings support California initiatives that set aside millions of dollars in a state budget and establish workgroups in an effort to address the high-cost drug trend.

“We look forward to working with public policy leaders to ensure we have greater transparency around the pricing of these drugs and to identify additional strategies that will sustain the long-term affordability of our health care system,” the authors added.