CNNMoney.com reported yesterday this little nugget:
"Prescription drug sales rate hits 47 year low"
Which suggests that drug sales were lower in 2007 than in the past 47 years, right?
Wrong.
Drug sales did NOT decrease in 2007. In fact, far from it. According to the IMS Health report that the article describes, prescription drug sales grew by 3.8% in 2007.
So why the confusing headline? Because the IMS report says that the rate of growth slowed in 2007. In other words, sales grew, but not as fast as in past years -- in 2006, sales grew by 8%.
"Growing but not as fast" is very different from "Declining," yet all too often media reports conflate the two. A slowing growth rate may foretell a trend that might eventually turn into an actual decline, but that can't be assumed.
The Associated Press ran a similar headline, although not as confusing: "US Prescription Drug Sales Growth Slows"
That's better but still confusing to the average reader.
What would be a better headline?
Here's my suggestion: "Drug sales grew in 2007, but slower."
Do you have one to propose? Post it in the comments.
By the way, we in the U.S. are now paying more than a quarter of a trillion dollars a year on prescription drugs -- $286.5 billion a year, to be exact. Are we getting our money's worth?
And in closing, why, according to IMS, did this slowdown-in-the-rate-of growth take place?
- Loss of exclusivity – Branded drugs representing $17 billion in sales lost exclusivity in 2007, helping to drive prescription volume growth of 10 percent for unbranded generics. In 2007, generics continued to replace branded prescriptions in the major therapeutic classes, increasing their share of total dispensed prescriptions to 67.3 percent.
- Uptake of new products – Uptake of new, innovative medicines represented just $441 million of total sales in 2007, reflecting both the fewest new product launches in the past three decades and slower adoption by physicians of these products.
- Medicare Part D contribution – Prescriptions dispensed through the Medicare Part D program accounted for 19 percent of retail prescriptions at the end of last year, a modest increase over 2006, and reflective of a maturing program. Today, 65 percent of U.S. citizens age 65 and older are enrolled in the Medicare Part D program.
- Safety issues – Sales growth in 2007 also was affected by a significant number of “black box” warnings and product withdrawals, as well as safety concerns raised by the FDA for products in the erythropoietins, diabetes and antidepressant therapy classes. Safety issues contributed to significantly lower- than-expected sales for products accounting for approximately 10 percent of the total prescription market.