The numbers don’t lie — the time to partner with an infusion care specialist and open your own in-office infusion center is now.

Magellan RX released its annual report on medical pharmacy trends and the message is clear: 2017 was a banner year for biologic pharmaceuticals. New pharmaceuticals are being approved at an incredible clip. Infusion centers are a prominent part of the pharmaceutical industry. Revenues are in the billions. Patients are benefitting. All that remains to be seen is whether 2018 will be even bigger.

Here are some key findings from the report.

Medical Pharmacy Claims

More than 5% of commercial health plan members and nearly 10% of Medicare Advantage members made a medical pharmacy claim in 2017. These claims include both specialty and non-speciality medications, though across the industry about 95% of the claims were for speciality medications — which is to say medications that are commonly injected or infused. Together, these represent millions of potential infusion center patients.

Medicare patient spending

The majority of Medicare pharmaceutical spending already occurs in the physician’s office, however the bulk of commercial benefit spending tends to occur in hospital outpatient facilities. Given that drug costs in the office are 13%-16% lower than in the hospital outpatient spending, the commercial benefit group presents a substantial growth opportunity for the in-office infusion center industry.

Commercial Drug Spending

Especially for certain medications, comercial drug spending is exploding. Psoriasis drug spending increased 230%. Crohn’s disease and ulcerative colitis therapies grew by 165%. Hematologic and oncologic spending grew by 100% and 113%, respectively. And that’s only a partial list of drugs that saw spending double or more in 2017. Each of these drugs represents an opportunity to expand the infusion center market.

Allowed per unit costs

Over the last five years, allowed per unit costs for benefit plans have increased substantially; commercial plan allowed costs are up an average of 15.5% and Medicare allowed costs grew by 6.0%. Meanwhile, the average annual inflation rate has only been about 1.9%. There has been some decrease in overall unit volume, but those change were more than counterbalanced by corresponding increases in health plan provider reimbursements. Taken together, this growth suggests an enormous profit opportunity for infusion center owners.

Specialty drug pipeline

In 2017, specialty drugs were approved by the FDA in many important categories, including breakthrough therapies in oncology. On top of that innovative gene therapy solutions including oncology CAR-T therapy agents, axicabtagene, ciloleucel and tisagenlecleucel were approved. There have also been steady approvals for biosimilars, and there are several more in the near-term pipeline. Each of these innovations offers yet another opportunity to bring a patient into an in-office infusion center.

Driving Progress with In-Office Infusion Centers

The bottom line is that specialty pharmaceuticals remain a high-growth industry — and the infusion centers that can deliver them to patients in a safe, comfortable and convenient environment can help doctors’ offices, primary care groups and urgent care centers capture some of that value. Providers who get out ahead of these trends by opening in-office infusion centers stand to benefit from what’s become a burgeoning revenue opportunity — not to mention a simple way to improve patient care. Partnering with an in-office infusion center management expert like OI Infusion Services is an exceedingly expeditious way for practices to ensure they're well-positioned for what's to come.