Skip to main content

A Retrospective Trend Analysis of Utilization, Spending, and Prices for Generic Statins in the US Medicaid Population, 1991-2022

Web Exclusives - Business, Original Research
Yiyu Chen, MS; Patricia R. Wigle, PharmD, PhD; Orson Austin, MD; Jeff Jianfei Guo, BPharm, PhD
Ms Chen is a PhD candidate, College of Pharmacy, University of Minnesota Twin Cities, Minneapolis, MN; Dr Wigle is Professor, James L. Winkle College of Pharmacy, University of Cincinnati Academic Health Center, Cincinnati, OH; Dr Austin is Physician, Cincinnati Christ Hospital and Professor Emeritus of Family Medicine, University of Cincinnati, Cincinnati, OH; Dr Guo is Professor, James L. Winkle College of Pharmacy, University of Cincinnati Academic Health Center.
Download PDF
Abstract

BACKGROUND: Statins are one of the most widely prescribed medication classes for the prevention and treatment of coronary heart disease. However, the cost burden of brand-name statin medication use has led payers to implement cost-containment policies.

OBJECTIVEs: To describe the trends of statins utilization, spending, and pricing per prescription; to assess the impact of generic statin entry on statin use; and to explore how Medicaid can take advantage of cost-lowering generic drug competition.

METHODS: A descriptive trend analysis was conducted using the Medicaid State Drug Utilization Data. The study period was from quarter 1 of 1991 through quarter 4 of 2022. The statins in the study were atorvastatin, cerivastatin, fluvastatin, lovastatin, pitavastatin, pravastatin, rosuvastatin, simvastatin, and their combinations. The trends were compared between each pair of generic and brand-name drugs. The annual number of prescriptions and reimbursement amounts were calculated for each of the statins reimbursed by Medicaid. The annual per-prescription spending as a proxy of drug prices was calculated by dividing the total reimbursement by the number of prescriptions. The currency amounts were standardized using the US Consumer Price Index based on the strength of the US dollar in 2022.

RESULTS: From 1991 to 2005, the amount of statin prescriptions increased from 0.7 million to 17.8 million, and the expenditure increased from $103.5 million to $2.8 billion. In 2008, the use of statins decreased to 6 million and the spending decreased to $609.7 million. In 2022, Medicaid spent $314.3 million (before rebates) on 28.6 million pharmacy prescription claims for statin medications. From 2001 to 2022, the use of generics increased to 28.6 million, and spending on generics increased to $300.3 million. In 2022, generics accounted for 99.9% of prescription claims and 95.6% of drug expenditures.

CONCLUSIONS: Increased statin expenditures were parallel with the rising use of statins. Drug competition includes interbrand, generic to brand-name drug, and generic drug competition. Switching to generic statin drugs offers a significant potential cost-savings for Medicaid programs.

KEY WORDS: brand-name drugs, drug cost, drug expenditure, generic drug entry, Medicaid, spending, statins, utilization

www.AHDBonline.com
February 2024 Vol 17,
Online Only—Original Research
Disclosures at end of text

Coronary heart disease (CHD) is the most common type of heart disease in the United States.1 In 2021, CHD accounted for approximately 695,000 American deaths.1 Studies have shown that high cholesterol levels are a significant risk factor for CHD.2-4 The 3-hydroxy-3-methylglutaryl coenzyme A reductase inhibitors, which are frequently referred to as statins, are the most effective and prevalent cholesterol-lowering agents.5 A large meta-analysis has shown that statins have a preventive effect on CHDs.5

Currently, 16 brand-name statins are FDA approved. The first statin, lovastatin (Mevacor), was approved in 1987, followed by pravastatin (Pravachol), simvastatin (Zocor), fluvastatin (Lescol and Lescol XL), atorvastatin (Lipitor), cerivastatin (Baycol), rosuvastatin (Crestor), pitavastatin (Livalo), atorvastatin (Liptruzet), and pitavastatin (Zypitamag). Altoprev/Atocor, an extended-release form of lovastatin, was approved in 2002. Since the introduction of the first generic statin, lovastatin, in the United States in 2001, 6 additional generic statins have become available, including pravastatin, simvastatin, amlodipine plus atorvastatin, atorvastatin, fluvastatin, and rosuvastatin.

Several combination drugs were also approved in the United States. The combination of extended-release niacin and lovastatin was approved in 2001. Niacin’s dual capacity to lower low-density lipoprotein cholesterol (LDL-C) and amplify high-density lipoprotein cholesterol (HDL-C) enhances the efficacy of the combination, making extended-release niacin plus lovastatin more potent than single-agent lovastatin or atorvastatin in enhancing HDL-C levels and more effective in reducing LDL-C than simvastatin.6,7 Subsequent approvals included amlodipine plus atorvastatin, ezetimibe plus simvastatin, niacin plus simvastatin, and ezetimibe plus atorvastatin. Despite the surge in popularity and confidence in statins, some of these drugs were proved to result in adverse events. Specifically, cerivastatin was withdrawn from the US market in 2001 as a result of several adverse events, such as rhabdomyolysis and renal failure.8 In 2016, the FDA concluded that the benefits of combining statins with niacin extended-release tablets did not outweigh the risks.9 As a result, niacin extended-release plus lovastatin and niacin extended-release plus simvastatin were discontinued from the US market in 2016.9

Given their efficacy in mitigating CHD risk, statins have become one of the most prescribed medications in the United States. From 2002 to 2013, the use of statins in US adults aged >40 years rose by 79.8%.10 Remarkably, despite this substantial increase in statin prescriptions, the total expenditures on statins decreased from $17.2 billion to $16.9 billion over the same period according to the Medical Expenditure Panel Survey database.10 This cost reduction is largely attributed to the introduction of generic drugs. The use of brand-name statins plummeted when cheaper generic drugs entered the market, which led to the reduction of spending on statins. Nonetheless, although the use of generic drugs continues to climb, spending on brand-name drugs remains substantial. In 2013, although brand-name statins were prescribed to only approximately 18% of patients, these drugs accounted for 55% of statin-related costs.10

The goals of this study are to better understand the underlying cause of the use, spending, and price trends related to statins; to examine the cost-lowering effect of using generic statins versus brand-name statins; and to provide important implications of public health to help health stakeholders to improve the cost-effectiveness of statin drugs and manage the associated costs.

Methods

A retrospective, descriptive study was conducted from the first quarter of 1991 through the last quarter of 2022. Our study focused on statins that were approved in the United States. Until 2022, there were 16 brand-name statin drugs and 8 generic statin drugs (Table 1). We extracted the national pharmacy summary claims of the Medicaid State Drug Utilization Data collected by the Centers for Medicare & Medicaid Services. The database collected information on Medicaid beneficiaries from 50 states in individual National Drug Code (NDC) drug forms. The database included the NDC, drug name, year and quarter of Medicaid expenditure, amount of total reimbursement, amount of total unit, and number of prescriptions by individual drug.

Table 1 Statin Drugs Marketed Between 1991 and 2022

The use of statins was estimated by adding the number of prescriptions for each statin identified by its NDC. The strength and dose were not considered in the calculation because patient-level data were not available. The total spending was estimated as the sum of quarterly Medicaid reimbursement. The total spending was not adjusted for federal or state rebates because of the lack of publicly available data; therefore, the total spending may be overestimated. The per-prescription payments for individual drugs, drug classes, and total drugs were calculated as the total reimbursement divided by the total number of prescriptions. This calculation is an imperfect measurement of prescription costs because it ignores the prescription strength and quantity, as well as federally mandated or supplemental state rebates. The market shares were estimated as the percentages of the total prescriptions and of the total payment amounts in the US Medicaid program.

Because of the transition of beneficiaries from Medicaid to Medicare Part D starting in January 2006, some data were missing for 2006 and 2007. Therefore, we imputed data for those years by averaging the values for 2005 and 2008. Although there are limitations to this study, because our primary goal is to examine and compare the trends, we assume that no major bias is introduced. The currency amounts were standardized using the US Consumer Price Index based on the strength of the US dollar in 2022.11

The time series curves were plotted to assess the utilization trends, the medication prices, and the reimbursement for statins over 30 years. To make the graphs more readable, we divided statins into different groups based on the intensity of the LDL-C reduction according to the American College of Cardiology and American Heart Association (ACC/AHA) guideline.12 According to the ACC/AHA’s guidelines, statins are typically classified into the 3 intensity levels of low, moderate, and high based on their dosing. Low-, moderate-, and high-intensity statins lower LDL-C levels by <30%, 30% to 49%, and ≥50%, respectively. High-intensity statins include atorvastatin 80 mg and rosuvastatin 20 mg; moderate-intensity statins include atorvastatin 10 mg, rosuvastatin 10 mg, simvastatin 20 to 40 mg, pravastatin 40 mg, lovastatin 40 mg, fluvastatin 40 mg, and pitavastatin 1 to 4 mg; and low-intensity statins include simvastatin 10 mg, pravastatin 10 to 20 mg, lovastatin 20 mg, and fluvastatin 20 to 40 mg.12

Because of the absence of specific dosing information in our data set, we faced challenges in accurately categorizing some statins that could fall into either of 2 intensity levels (eg, low vs moderate, or moderate vs high) depending on their dosage. Therefore, we opted to group the statins into the broader categories of low-to-moderate–intensity statins, moderate-to-high–intensity statins, and combination drugs. This approach, although slightly divergent from the standard classification of statins, was necessary to accommodate the limitations of our data regarding the precise dosage details. Low-to-moderate–intensity statins included fluvastatin, lovastatin, pitavastatin, pravastatin, and simvastatin. Moderate-to-high–intensity statins included atorvastatin and rosuvastatin. The influence of brand–generic competition was studied by comparing the spending on and price of each pair of drugs. The trends were compared between each pair of generic and brand-name drugs. All data analyses were performed with Statistical Analysis Software version 9.4 (SAS Institute Inc; Cary, NC).

Results

Table 2 delineates the annual Medicaid expenditures alongside the number of prescriptions for statins. From 1991 to 2005, the total Medicaid expenditure for statins increased substantially from $103.5 million to $2.8 billion. Significant declines in this expenditure were noted in 2006 and in 2007. The total spending on statins decreased considerably to $326.3 million in 2013, with a modest rise to $417.3 million in 2015. After 2015, there was a consistent decrease in spending, with 2022 expenditures at $314.3 million. In total prescription volume, between 1991 and 2007, there was an increase from 0.7 million to 13.8 million prescriptions. Similar to the expenditure trends, there was an evident sharp decline in prescription volume in 2008 to 6 million; however, this was followed by a steady increase in volume from 6 million to 19.8 million in 2019. The number of overall prescriptions declined temporarily in 2020 to 10.7 million and in 2021 to 11.3 million, but they rebounded to 28.6 million in 2022. Overall, the use of statins increased approximately 40-fold between 1991 and 2022.

Table 2 Annual Medicaid Expenditure and Number of Prescriptions for Statins, 1991-2020

We examined the trends in payment and utilization of generic drugs and brand-name drugs. As shown in Table 2, there was a sustained growth in the use of generic statins, escalating from 14 prescriptions in 2001 to 1 million prescriptions by 2005. Before 2005, the growth rate for brand-name statin use significantly outpaced that of generic statins. After 2008, however, generic statin prescriptions continually climbed, averaging approximately 20 million annually from 2016 to 2019. Conversely, brand-name statin use decreased since 2008 and reached 0.03 million prescriptions in 2022. Although the use of generic statins rose sharply, Medicaid expenditures for these generics remained relatively moderate, totaling $300.3 million in 2022. The spending trends for brand-name statins were quite different. Between 1991 and 2006, the expenditures for brand-name statins surged from $103.5 million to $2.7 billion. However, there was a marked decrease, with expenditures in 2022 dropping to approximately $14 million.

The annual trends in spending, utilization, and pricing for each statin drug are shown in Figures 1, 2, and 3, respectively. Before 2006, the use of statins skyrocketed over 15 years. This surge in utilization paralleled a sharp increase in Medicaid spending on statins. Notably, the reimbursements for brand-name atorvastatin, simvastatin, and pravastatin exhibited pronounced growth. In 2005, the US Medicaid program spent $1.2 billion on brand-name atorvastatin, $894.8 million on brand-name simvastatin, and $248.9 million on brand-name pravastatin. However, after 2006, the utilization of and reimbursement for brand-name statins began to wane, whereas the uptake of generic statins surged. For example, prescriptions for generic atorvastatin escalated to 19.4 million in 2022, whereas those for brand-name atorvastatin decreased to 3000. Despite the pronounced increase in the use of generic statins, Medicaid spending on these drugs remained comparatively consistent. Combination statins were not frequently prescribed in the Medicaid program over time.

Figure 1 Annual Reimbursement for Statins in the US Medicaid Program, 1991-2022
Figure 2 Annual Utilization of Statins in the US Medicaid Program, 1991-2022
Figure 3 Annual Payment per Prescription of Statins in the US Medicaid Program, 1991-2022

Market shares were calculated based on the number of prescriptions and Medicaid expenditures. Table 3 summarized these 2 types of market shares for generic statins, and market shares by expenditure for the most frequently prescribed statins. Brand-name lovastatin, the first blockbuster statin approved by the FDA, held a dominant market share for several years. However, its supremacy was challenged in 1991 with the approval of brand-name pravastatin, a classic “me-too” drug. Brand-name pravastatin’s competitive pricing strategy successfully carved out its significant market presence. Then, in 1992, Merck launched brand-name simvastatin, a derivative of brand-name lovastatin. Since 1997, brand-name simvastatin took over the dominant position, claiming 30% market shares for the subsequent years. Introduced in late 1996, brand-name atorvastatin, with its cost-effectiveness compared with brand-name simvastatin, dominated the market immediately, eclipsing even brand-name lovastatin and brand-name simvastatin. This dominance remained until 2011, with brand-name atorvastatin’s market share by expenditure peaking at 51% in 2009.

Table 3 Annual Market Shares of Top Prescribed Statins and Total Generic Statins in Medicaid Programs, 1991-2022

Generic statins entered the market after 2001 when brand-name lovastatin lost its patent protection. In the first 5 years after generic drug entry, brand-name drugs still took approximately 95% of the market shares by prescriptions and 98% of the market shares by expenditure. There was a sharp increase in the market shares by prescriptions in 2006 from 5.38% to 43.41%. Since 2006, generic statins quickly captured the Medicaid market. Market shares by expenditure increased to 95.6%, and market shares by prescriptions increased to 99.9% in 2022. In 2020, generic atorvastatin (64.1%) accounted for the largest share of Medicaid spending on statins, followed by generic rosuvastatin (16.2%), generic simvastatin (7.8%), and generic pravastatin (6.1%).

The impact of brand–generic competition on utilization is shown in Figure 1. We compared 4 pairs of brand-name and generic statins: brand-name lovastatin with generic lovastatin, brand-name simvastatin with generic simvastatin, brand-name pravastatin with generic pravastatin, and brand-name atorvastatin with generic atorvastatin. The use of brand-name drugs rose when they entered the market, but this swiftly declined with the introduction of their generic counterparts. Conversely, the uptake of generic drugs consistently grew after entering the market and maintained prominence over their brand-name equivalents. For example, the use of brand-name lovastatin plummeted after 1996 and, by 2001, was nearly supplanted by generic lovastatin. Similar to brand-name lovastatin, brand-name pravastatin was almost replaced by generic pravastatin. In 2005, brand-name simvastatin prescriptions totaled 4.4 million. Since the introduction of generic simvastatin, brand-name simvastatin prescriptions decreased to mere hundreds annually, whereas generic simvastatin’s prescriptions increased to 6.3 million in 2015. Brand-name atorvastatin used to be the most prescribed statin before 2006; however, as of 2022, the number of generic atorvastatin prescriptions has reached 19.4 million and it became the most widely prescribed statin.

Comparisons of the per-prescription payments are shown in Figure 3. Although some fluctuations were observed, most brand-name statins displayed a relatively stable cost trajectory. Brand-name simvastatin, brand-name pravastatin, and brand-name atorvastatin all exhibited modest upward trends in their per-prescription payments, whereas the cost of brand-name lovastatin decreased. Generic statins, in contrast, typically had significantly lower per-prescription costs than their brand-name counterparts. On introduction, a generic drug’s cost often began similar to its brand-name equivalent but would soon decrease substantially. For example, the per-prescription payment for generic lovastatin was $130.10 in 2001, which is similar to brand-name lovastatin’s price of $163.80 per prescription. However, the cost of generic lovastatin decreased to $9 in 2022. Similarly, generic atorvastatin had a per-prescription cost of $159 when it was introduced in 2011, which decreased to $10.40 by 2022.

Competition between generic drugs was also observed. Generic pravastatin and generic simvastatin entered the market in 2006, but unlike generic atorvastatin and generic lovastatin, they maintained consistently low prices. In their introduction year, generic pravastatin was priced at $31.80 per prescription and generic simvastatin was $12.50.

Discussion

The dramatic decrease in Medicaid expenditures for statins in 2006 and 2007 can largely be attributed to the shift of dual-eligible beneficiaries from Medicaid to Medicare Part D, which became effective on January 1, 2006.13 Given that CHD predominantly affects elderly people aged ≥65 years, this transition significantly influenced our study.14 In addition, a slight decrease in the use of statins was noted in the years 2020 and 2021. This can be attributed to delayed treatment during the COVID-19 pandemic. Aside from the anomalies in 2006 and 2007 and the pandemic-induced decrease in statin use, the overall trend in statin use has been a consistent increase. Several factors contribute to this rising trajectory in the use of statins.

The awareness of cholesterol management has been raised through education campaigns, clinical studies, the dissemination of guidelines, and other public initiatives. These efforts have significantly contributed to the widespread use of statins. Between the years 1988 and 1994 and the years 2007 and 2010, there was a notable rise in statin use among patients, surging from 5% of the population to 23%.15 This increase in statin use has been associated with declines in the prevalence of low HDL-C, elevated total cholesterol levels, and CHD and its related mortality rate over the past few decades.16,17 In addition, there has been a trend for long-term statin use to manage cholesterol. However, despite the high prescription rates of statins, only 62.3% of eligible patients were receiving statin therapy in 2017.18 Given that statins are a crucial intervention in the prevention of CHD and considering the existing gap in treatment among eligible patients, we infer that there is potential for further increase in statin utilization.

Although the trend indicates a general increase in statin use, it is important to note that prescribing statins to elderly patients aged ≥65 years requires careful consideration of multiple factors, including life expectancy, patient tolerability, and access to healthcare services.19 Such individualized assessments ensure that the benefits of statin therapy are balanced against the potential risks in this population.

Safety and effectiveness considerations are the main reasons for the trend of increasing statin use. Two meta-analyses of statins have demonstrated the long-term safety of statins; the risk for clinically relevant adverse events is very low.20,21 According to the results of an AHA study, only 10% of patients stopped receiving statins because of subjective complaints, such as muscle symptoms.22 Furthermore, statin therapy has shown remarkable efficacy in reducing major vascular events in a wide range of populations.22 A review of robust evidence from large-scale studies suggests that statins can prevent 25% of vascular events for each 1-mmol/L reduction in LDL-C.23 Overall, the benefits outweigh the associated risks of statin therapy for eligible patients.

Although statins share a common mechanism for lowering cholesterol levels, their effectiveness can vary. Studies have shown that atorvastatin had a greater effect on reducing LDL-C than fluvastatin, pravastatin, lovastatin, and simvastatin.24,25 Conversely, several clinical trials have indicated that rosuvastatin in particular achieves greater reductions in LDL-C levels than atorvastatin.26-28

These findings align with our own study results on statin utilization. According to our findings, brand-name rosuvastatin emerged as the most prescribed moderate-to-high–intensity statin. We found that before 2006, brand-name atorvastatin was the most prescribed brand-name statin. Our results also show that atorvastatin was the most prescribed statin since 2015.

The remarkable safety and effectiveness of statins has led to a significant expansion in the indications outlined by practice guidelines, leading to a broader patient population. In 2001, the Adult Treatment Panel III (ATP III) of the National Cholesterol Education Program issued evidence-based recommendations for cholesterol management.29 The ATP III guidelines recommended statin medication use for CHD based on the presence of certain risk factors and the LDL-C threshold.29 The 2013 ACC/AHA guidelines introduced a more comprehensive risk assessment, which estimates the 10-year risk for all atherosclerotic cardiovascular diseases.30 This expansion broadened the population that could benefit from statin therapy.30 The 2013 ACC/AHA cholesterol guidelines nearly doubled the number of individuals qualifying for statins compared with the 2004 ATP III criteria.31 The subsequent 2018 and 2019 ACC/AHA guidelines continued this trend, advocating for lifelong statin use for lipid management, while refining the guidance for intermediate-risk patients to reduce the potential overprescription of statins.32

In our study, we observed a noticeable increase in statin use after the 2013 ACC/AHA guidelines, which is indicative of the impact that evolving cholesterol management guidelines have had on clinical practice. After 2018, however, the increase in statin use has moderated and may be attributed to a more tailored assessment of cardiovascular risk, which is in line with the 2018 and 2019 ACC/AHA guidelines.

Direct-to-consumer advertising (DTCA) can stimulate the demand for statins by fostering awareness of their effectiveness and encouraging patients to seek treatment. Research has shown that a 10% increase in DTCA yields a 1% increase in drug sales.33 Notably, the total expenditure on DTCA had a staggering 330% surge from 1996 to 2005, with a subsequent 7.8% decrease from 2005 to 2009.34,35 These substantial investments in advertising proved highly successful in promoting the use of statins.

DTCA also influenced the preference for specific statins. During the 2000s, brand-name versions of atorvastatin, rosuvastatin, and ezetimibe plus simvastatin were actively marketed. Brand-name atorvastatin was the fifth me-too drug in the statin class. Interestingly, although brand-name atorvastatin arrived later than other statins, it gained market share swiftly and maintained the leading statin position until its patent expired. Similarly, the DTCA strategy helped brand-name rosuvastatin successfully launch in the market.

The expansion of Medicaid is a significant contributing factor to the rising use of statins by Medicaid patients. In 2010, 33 states in the United States and Washington, DC, agreed to receive federal funding to expand Medicaid programs under the Affordable Care Act, which expanded Medicaid coverage to adults with income up to 138% of the federal poverty level.36 As of December 2023, 41 states (including Washington, DC) have adopted Medicaid expansion36; as of March 2020, approximately 71.6 million people were enrolled in Medicaid programs, reflecting a significant increase of approximately 14 million people, or 24.7%, since 2013.36,37

In our findings, the per-prescription costs for generic statins were substantially lower than for brand-name statins, and they exhibited a consistent decrease over time. The decline in prices can be attributed to competition between brand-name and generic drugs, and generic-to-generic drug competition. It is interesting to note that the per-prescription cost tends to be higher when only a single generic option is available compared with situations in which more than 2 generic alternatives simultaneously enter the market.

We did not observe significant examples of interbrand competition. The per-prescription cost trends for brand-name statins were relatively stable, even after the expiration of their patents. Brand-name drugs have patent protection for nearly a decade after their market introduction, and as a result, their pricing is minimally influenced by competitive forces within the drug market. Our findings align with those of another study that examined brand-to-brand competition,38 suggesting that efforts to enhance interbrand competition within the same therapeutic class may not necessarily lead to reductions in per-prescription payments.

When generic equivalents with lower prices become accessible, payers tend to favor these cost-effective generic substitutes by requiring less cost-sharing for generic versus brand-name drugs.39 Although some physicians have their own prescribing preferences, most states have enacted drug substitution laws.40 These laws empower pharmacists to dispense generic drugs as a substitution for brand-name drugs to some degree.40

Furthermore, Medicaid programs and private insurance companies employ mechanisms to regulate the use of brand-name medications. These mechanisms encompass drug lists that necessitate prior authorization and tiered copayment systems designed to encourage preference for generic drugs. Hence, we observed that once the patent for a brand-name drug expires, the market shares for generic drugs within Medicaid tend to rise significantly when generic alternatives become available.

However, in our study, it is important to note that although the Medicaid market shares for brand-name statins sharply declined, the payment per prescription remained at a relatively elevated level for an extended period. Subsequently, there was only a slight decrease in prescription payments long after the introduction of generic alternatives. Our study does not provide conclusive evidence to support the notion that the decrease in brand-name drug prices can be directly attributed to the entry of generic drug competitors.

Generic drug competition leads to significantly reduced per-prescription expenditures. Generic drug competition includes competition within the same drug class and among different suppliers. Currently, the Medicaid market distributes 7 different generic statins from more than 10 pharmaceutical manufacturers. This intense competition among generic drugs inevitably drives prices down. The per-prescription cost for generic pravastatin was 12% of brand-name pravastatin, generic simvastatin’s cost was 9% of brand-name simvastatin, and generic atorvastatin’s cost was 17% of brand-name atorvastatin on average.

Regulatory approaches also have an impact on generic drug competition. One is the Drug Price Competition and Patent Term Restoration Act, also known as the Hatch-Waxman Act of 1984.41 Under this act, generic drug manufacturers are only required to demonstrate bioequivalence when filing Abbreviated New Drug Applications (ANDAs) and are offered protection from patent infringement lawsuits. In addition, this act grants a 180-day period of non–patent exclusivity to the first generic version of a drug to file an ANDA.41 Hence, when the first generic version of a drug enters the market, it will typically command a relatively high price. However, the price swiftly decreases as other generic drug alternatives enter the market after the 180-day period.

Medicaid spending on statins presented an upward trajectory before 2006 and has since had a subsequent decline. The sharp ascent in spending during the earlier period reflected the skyrocketing use of statins and the escalating prices of brand-name drugs. However, a notable shift occurred after 2008 when a greater number of generic drug alternatives entered the market, driving down the overall spending on statins. In addition to the factors previously discussed in this article, some regulatory approaches also control the spending within Medicaid programs.

The Omnibus Budget Reconciliation Act of 1981 was the first regulation for expenditure control by imposing restrictions on Medicaid eligibility.42 The subsequent Boren Amendment required Medicaid payments to be reasonable and adequate, considering the efficiency and economic cost. The Omnibus Budget Reconciliation Act of 1990 established the Medicaid prescription drug rebate program, which mandates pharmaceutical manufacturers to give “best price” discounts or rebates to the government, further contributing to cost control within Medicaid.42

Moreover, the implementation of a management process known as prior authorization helps minimize Medicaid spending. Under prior authorization, states may require prescribers to obtain approval from the state Medicaid agency before dispensing a specific medication, especially when more cost-effective substitutes are available. Many states have implemented prior authorization requirements for the statin class, which may contribute to reduced spending on statins within the Medicaid program.

Limitations

Our study has limitations. Using Medicaid claims data is subject to inherent limitations. First, drug use information was aggregated by pharmacy claims data from different state Medicaid programs. We do not have access to patient-level clinical data, thus preventing us from conducting assessments at the individual patient level. Second, our drug event file lacks diagnosis codes, making it a challenge to attribute statin prescribing to specific medical conditions or diagnoses. Third, we do not have detailed data on drug dose and strength. Therefore, our estimation of the cost per prescription may not precisely mirror the actual price trends associated with statins. Fourth, the data in our study have not been adjusted to account for federally mandated or supplemental state rebates. Nonetheless, given that our study primarily focuses on longitudinal trends, we anticipate that any potential bias introduced by the absence of rebate adjustments would be minimal.

It is also essential to acknowledge the significant transition of dual-eligible beneficiaries from Medicaid to Medicare Part D that began in January 2006. This transition was especially noteworthy because CHD predominantly affects elderly individuals. This migration played a pivotal role in the sharp decline in spending on and use of statins observed in 2006 and the subsequent years. This movement also resulted in abnormal data for the years 2006 and 2007. Therefore, we imputed the data for 2006 and 2007 by taking the average reimbursement and number of statin prescriptions from 2005 and 2008.

Conclusion

In 2022, Medicaid spent $314.3 million (before rebates) to cover 28.6 million pharmacy prescription claims for statin medications. The upward trajectory in statin drug expenditures from 1991 to 2006 can primarily be attributed to the increased use of statins, whereas decreases in statin drug spending from 2008 to 2022 resulted from a transition to the use of cheaper generic drug alternatives. The reduction in prices is a consequence of the drug competition, encompassing interbrand drug competition, generic drug competition, and competition between generic and brand-name drugs.

As observed in our study, switching from brand-name statin drugs to generic statins yields significant cost-savings. By 2022, generic drugs occupied the majority of the market share, resulting in a reduced total expenditure.

Our study is based on the integrated data of all state Medicaid programs. Our results will provide implications for other studies of state Medicaid cost-containment policies and regulations, and the experiences learned from Medicaid programs can be a valuable reference to Medicare programs as well.

Author Disclosure Statement
Ms Chen is a Graduate Research Fellow for AbbVie (2021-2023); Dr Guo conducted a consulting research seminar for AbbVie Pharmaceutical in 2022 and for Takeda Pharmaceutical in 2023; and Dr Wigle and Dr Austin have no conflicts of interest to report.

References

  1. Centers for Disease Control and Prevention. Heart disease facts. Updated May 15, 2023. Accessed December 11, 2023. www.cdc.gov/heartdisease/facts.htm#print
  2. Peters SAE, Singhateh Y, Mackay D, et al. Total cholesterol as a risk factor for coronary heart disease and stroke in women compared with men: a systematic review and meta-analysis. Atherosclerosis. 2016;248:123-131.
  3. März W, Kleber ME, Scharnagl H, et al. HDL cholesterol: reappraisal of its clinical relevance. Clin Res Cardiol. 2017;106:663-675.
  4. Giammanco A, Noto D, Barbagallo CM, et al. Hyperalphalipoproteinemia and beyond: the role of HDL in cardiovascular diseases. Life (Basel). 2021;11:581.
  5. Li M, Wang X, Li X, et al. Statins for the primary prevention of coronary heart disease. Biomed Res Int. 2019;2019:4870350.
  6. Bays HE, Dujovne CA, McGovern ME, et al. Comparison of once-daily, niacin extended-release/lovastatin with standard doses of atorvastatin and simvastatin (the Advicor Versus Other Cholesterol-modulating Agents Trial Evaluation [ADVOCATE]). Am J Cardiol. 2003;91:667-672.
  7. Kamanna VS, Kashyap ML. Mechanism of action of niacin. Am J Cardiol. 2008;101(8 suppl):20B-26B.
  8. Staffa JA, Chang J, Green L. Cerivastatin and reports of fatal rhabdomyolysis. N Engl J Med. 2002;346:539-540.
  9. US Food and Drug Administration, HHS. AbbVie Inc. et al; withdrawal of approval of indications related to the coadministration with statins in applications for niacin extended-release tablets and fenofibric acid delayed-release capsules. Notice. Fed Regist. 2016;81:22612-22613.
  10. Salami JA, Warraich H, Valero-Elizondo J, et al. National trends in statin use and expenditures in the US adult population from 2002 to 2013: insights from the Medical Expenditure Panel Survey. JAMA Cardiol. 2017;2:56-65.
  11. US Bureau of Labor Statistics. Consumer Price Index. Accessed October 11, 2023. www.bls.gov/cpi/
  12. Grundy SM, Stone NJ, Bailey AL, et al. 2018 AHA/ACC/AACVPR/AAPA/ABC/ACPM/ADA/AGS/APhA/ASPC/NLA/PCNA Guideline on the Management of Blood Cholesterol: A Report of the American College of Cardiology/American Heart Association Task Force on Clinical Practice Guidelines. Circulation. 2019;139:e1082-e1143. Errata in: Circulation. 2019;139:e1182-e1186; Circulation. 2023;148:e5.
  13. Megellas MM. Medicare modernization: the new prescription drug benefit and redesigned Part B and Part C. Proc (Bayl Univ Med Cent). 2006;19:21-23.
  14. Heart disease prevalence. In: Health, United States, 2020–2021. Centers for Disease Control and Prevention. June 26, 2023. Accessed December 23, 2023. www.cdc.gov/nchs/hus/topics/heart-disease-prevalence.htm
  15. Kuklina EV, Carroll MD, Shaw KM, Hirsch R. Trends in high LDL cholesterol, cholesterol-lowering medication use, and dietary saturated-fat intake: United States, 1976–2010. National Center for Health Statistics Data Brief, No 117. Department of Health & Human Services; March 2013. Accessed December 23, 2023. www.cdc.gov/nchs/data/databriefs/db117.pdf
  16. Carroll MD, Fryar CD. Total and high-density lipoprotein cholesterol in adults: United States, 2015–2018. National Center for Health Statistics Data Brief, No 363. Department of Health & Human Services; April 2020. Accessed December 23, 2023. www.cdc.gov/nchs/data/databriefs/db363-h.pdf
  17. Yoon SSS, Dillon CF, Illoh K, Carroll M. Trends in the Prevalence of Coronary Heart Disease in the U.S.: National Health and Nutrition Examination Survey, 2001–2012. Am J Prev Med. 2016;51:437-445.
  18. Sidebottom AC, Vacquier MC, Jensen JC, et al. Trends in prevalence of guideline-based use of lipid-lowering therapy in a large health system. Clin Cardiol. 2020;43:560-567.
  19. Curfman G. Risks of statin therapy in older adults. JAMA Intern Med. 2017;177:966.
  20. Mach F, Ray KK, Wiklund O, et al. Adverse effects of statin therapy: perception vs. the evidence – focus on glucose homeostasis, cognitive, renal and hepatic function, haemorrhagic stroke and cataract. Eur Heart J. 2018;39:2526-2539d.
  21. Lv HL, Jin DM, Liu M, et al. Long-term efficacy and safety of statin treatment beyond six years: a meta-analysis of randomized controlled trials with extended follow-up. Pharmacol Res. 2014;81:64-73.
  22. Newman CB, Preiss D, Tobert JA, et al; for the American Heart Association Clinical Lipidology, Lipoprotein, Metabolism and Thrombosis Committee, a Joint Committee of the Council on Atherosclerosis, Thrombosis and Vascular Biology and Council on Lifestyle and Cardiometabolic Health; Council on Cardiovascular Disease in the Young; Council on Clinical Cardiology; and Stroke Council. Statin safety and associated adverse events: a scientific statement from the American Heart Association. Arterioscler Thromb Vasc Biol. 2019;39:e38-e81. Erratum in: Arterioscler Thromb Vasc Biol. 2019;39:e158.
  23. Collins R, Reith C, Emberson J, et al. Interpretation of the evidence for the efficacy and safety of statin therapy. Lancet. 2016;388:2532-2561. Erratum in: Lancet. 2017;389:602.
  24. Jones P, Kafonek S, Laurora I, Hunninghake D; for the CURVES investigators. Comparative dose efficacy study of atorvastatin versus simvastatin, pravastatin, lovastatin, and fluvastatin in patients with hypercholesterolemia (the CURVES study). Am J Cardiol. 1998;81:582-587. Erratum in: Am J Cardiol. 1998;82:128.
  25. Schaefer EJ, McNamara JR, Tayler T, et al. Comparisons of effects of statins (atorvastatin, fluvastatin, lovastatin, pravastatin, and simvastatin) on fasting and postprandial lipoproteins in patients with coronary heart disease versus control subjects. Am J Cardiol. 2004;93:31-39.
  26. Jones PH, Davidson MH, Stein EA, et al; for the STELLAR study group. Comparison of the efficacy and safety of rosuvastatin versus atorvastatin, simvastatin, and pravastatin across doses (STELLAR trial). Am J Cardiol. 2003;92:152-160.
  27. Olsson AG, Istad H, Luurila O, et al; for the Rosuvastatin Investigators Group. Effects of rosuvastatin and atorvastatin compared over 52 weeks of treatment in patients with hypercholesterolemia. Am Heart J. 2002;144:1044-1051.
  28. Brown WV, Bays HE, Hassman DR, et al; for the Rosuvastatin Study Group. Efficacy and safety of rosuvastatin compared with pravastatin and simvastatin in patients with hypercholesterolemia: a randomized, double-blind, 52-week trial. Am Heart J. 2002;144:1036-1043.
  29. Expert Panel on Detection, Evaluation, and Treatment of High Blood Cholesterol in Adults. Executive Summary of the Third Report of the National Cholesterol Education Program (NCEP) Expert Panel on Detection, Evaluation, and Treatment of High Blood Cholesterol in Adults (Adult Treatment Panel III). JAMA. 2001;285:2486-2497.
  30. Cho YK, Jung CH, Kang YM, et al. 2013 ACC/AHA Cholesterol Guideline versus 2004 NCEP ATP III Guideline in the prediction of coronary artery calcification progression in a Korean population. J Am Heart Assoc. 2016;5:e003410.
  31. Pursnani A, Mayrhofer T, Ferencik M, Hoffmann U. The 2013 ACC/AHA cardiovascular prevention guidelines improve alignment of statin therapy with coronary atherosclerosis as detected by coronary computed tomography angiography. Atherosclerosis. 2014;237:314-318.
  32. Reiter-Brennan C, Osei AD, Uddin SMI, et al. ACC/AHA lipid guidelines: personalized care to prevent cardiovascular disease. Cleve Clin J Med. 2020;87:231-239.
  33. Kaiser Family Foundation. Impact of Direct-to-Consumer Advertising on Prescription Drug Spending. June 10, 2003. Accessed February 2, 2022. www.kff.org/health-costs/report/impact-of-direct-to-consumer-advertising-on-prescription-drug-spending/
  34. Donohue JM, Cevasco M, Rosenthal MB. A decade of direct-to-consumer advertising of prescription drugs. N Engl J Med. 2007;357:673-681.
  35. Preechavuthinant S, Willis W, Coustasse A. Trends and effects of pharmaceutical DTCA. Int J Pharm Healthc Mark. 2018;12:61-70.
  36. Kaiser Family Foundation. Status of state Medicaid expansion decisions: interactive map. December 1, 2023. Accessed December 20, 2023. www.kff.org/medicaid/issue-brief/status-of-state-medicaid-expansion-decisions-interactive-map/
  37. Medicaid and CHIP Payment and Access Commission. Medicaid enrollment changes following the ACA. Accessed February 10, 2022. www.macpac.gov/subtopic/medicaid-enrollment-changes-following-the-aca/
  38. Sarpatwari A, DiBello J, Zakarian M, et al. Competition and price among brand-name drugs in the same class: a systematic review of the evidence. PLoS Med. 2019;16:e1002872.
  39. Claxton G, Cox C, Rae M. The cost of care with marketplace coverage. KFF. February 11, 2015. Accessed December 23, 2023. www.kff.org/health-costs/issue-brief/the-cost-of-care-with-marketplace-coverage/
  40. Pasha AS. Generic substitution laws and combination products. Food Drug Law J. 2023;78:215-234.
  41. Soehnge H. The Drug Price Competition and Patent Term Restoration Act of 1984: fine-tuning the balance between the interests of pioneer and generic drug manufacturers. Food Drug Law J. 2003;58:51-80.
  42. Medicaid and CHIP Payment and Access Commission. Federal legislative milestones in Medicaid and CHIP. Accessed December 20, 2023. www.macpac.gov/reference-materials/federal-legislative-milestones-in-medicaid-and-chip/
Related Items
Changes in Antipsychotic Medication Use Among Medicare Patients in a Nursing Home, 2010 to 2015
Michele Berrios, Bruce S. Pyenson, FSA, MAAA, Kyle Pérez, MPH, Heidi C. Waters, PhD
Web Exclusives published on November 10, 2023 in Original Research, Clinical
Employer Disability and Workers’ Compensation Trends for Their Employees With Ophthalmic Conditions in the United States
Richard A. Brook, MS, MBA, Nathan L. Kleinman, PhD, Ian A. Beren, BS
Web Exclusives published on August 21, 2023 in Business, Original Research
Cost-Savings Using Patients’ Own Medication Supply of Letermovir for Allogeneic Hematopoietic Stem-Cell Transplant Recipients During Hospitalization
Harrison S. Yoon, PharmD, Mallory Crain, PharmD, BCOP, Marissa Olson, PharmD, BCOP, Anupam Pande, MD, MPH, Jeff O. Klaus, PharmD, BCPS
Web Exclusives published on July 18, 2023 in Original Research
Clinical and Financial Impacts of an Ambulatory Oncology Pharmacist–Based Intravenous Chemotherapy Education and Follow-Up Program
Grant W. Lee, PharmD, BCOP, Joseen J. Chundamala, PharmD, Kerri L. Monahan, PharmD, Judy J. Cho, PharmD, Lydia J. Berry, RPh, PharmD, Christine G. Cambareri, PharmD, BCOP, CSP
Web Exclusives published on July 6, 2023 in Original Research, Business
Trends in Utilization, Prices, and Spending for Oral Medications for Breast Cancer Treatment in the US Medicaid Population, 2008-2019
Fatimah Alyam, MS, PhD, Jeff Jianfei Guo, BPharm, PhD
June 2023 Vol 16, No 1 published on May 26, 2023 in Business, Original Research
Last modified: February 5, 2024