OBJECTIVES: Antipsychotics have been a major driver of Medicaid prescription drug expenditure, mostly due to high cost and utilization of atypical antipsychotics. The study objective is to describe and evaluate the trends of atypical antipsychotics’ expenditure, utilization and price.

METHODS: A retrospective time-series trend analysis was conducted. The primary data source was the National Medicaid Pharmacy summary claim files collected by the Center for Medicaid/Medicare Services from 1991 to 2017. The quarterly reimbursement amount, number of prescriptions (Rx), reimbursement per prescription and per unit (proxy of drug price) figures were constructed for each branded and generic atypical antipsychotic such as olanzapine, risperidone, quetiapine, aripiprazole, and ziprasidone. The trends were compared between branded and generic drugs in order to assess the impact of generic entry. The annual percentage changes were calculated for reimbursement, utilization, and price..

RESULTS: Total Medicaid spending on atypical antipsychotics increased from $16 million in 1991 to $5.5 billion in 2005, averaged a 59% growth rate. The utilization also increased from 172 thousand Rx to over 21 million Rx in 2005. Post-2006 period saw a sharp decline in both uptake and spending, which bottomed out at $3.6 billion reimbursed and 10.7 million Rx dispensed in 2008, before slowly recovered. Despite the percentage of antipsychotics Rx dispensed as generics exploded from 12% in 2008 to 89% in 2017, the majority of expenditures were driven by branded medications, accounting for over 83%, driven by increased price per Rx.

CONCLUSIONS: Use of generic drugs grew in marketshare, but low impact on the price of existing branded drugs. Outside of cost, providers and patients’ preferences, off-label usage, FDA warnings and lawsuits are all important factors impacted spending and utilization of this class of drugs.