Pharmacy Benefit Management Market Size

Pharmacy Benefit Management Market Analysis

The Pharmacy Benefit Management Market size is estimated at USD 589.40 billion in 2024, and is expected to reach USD 775.34 billion by 2029, growing at a CAGR of 5.64% during the forecast period (2024-2029).

• COVID-19 impacted the growth of the pharmacy benefit management market. According to an article published in Research in Social and Administrative Pharmacy, in January 2021, due to the rise in demand for different pharmaceuticals, especially prescription drugs such as metformin, omeprazole, and others, hospitals have faced difficulties in personnel, drug supply, and pharmaceutical care. Also, the companies providing a diversified array of pharmacy care services have reported a significant increase in their revenue.
• For instance, as per the 2021 Annual Report, the revenue of Optum Inc. from Optum RX (a full-service prescription drug benefit provide) with a broad network of retail chains and independent pharmacies) was USD 91,314 million in 2021, with an increase of 4%, as compared to USD 87,498 million in 2020. Thus, the adoption of PBM solutions may increase over the years due to the benefits observed during the pandemic.
• The rising inclination towards pharmacy benefits management increases the accuracy, improves the safety and efficiency of the pharmacy store as well as improves patient health outcomes. This is anticipated to fuel the market growth over the forecast period.
• For instance, in March 2022, Elixir, the pharmacy benefit manager (PBM) division of Rite Aid, revealed its membership in the Pharmaceutical Care Management Association (PCMA). The addition of Elixir to PCMA boosts patients' access to affordable prescription drugs. Thus, the growing demand for pharmacy benefit management services among drug manufacturers, retail pharmacies, and health insurance providers is expected to fuel the market growth over the forecast period.
• The increase in the number of persons utilizing insurance to deal with the rise in medical costs, such as paying for treatment, hospitalization, health check-up, and hospitalization charges. Additionally, PBM combines medical and pharmaceutical products to support end-to-end healthcare solutions that enable the insurers to have comprehensive information about the patients, which enables the insurers to offer patients effective programs. This is also expected to fuel the demand for pharmacy benefit management systems, hence bolstering market growth.
• Furthermore, the rising health spending across the globe is expected to increase the adoption of technologically advanced software and solutions to monitor the inventory and supply of drugs as well as provide affordable medications to patients. This is anticipated to augment the market growth over the forecast period. For instance, according to the 2021 data published by the Centers for Medicare and Medicaid Services, the National Health Service increased by 2.7% to USD 4.3 trillion in 2021 (USD 12,914 per person), which accounted for 18.3% of GDP. In addition, as per the same source, private health insurance spending increased by 5.8% to USD 1,211.4 billion in 2021, and prescription drug spending increased by 7.8% to USD 378 billion in 2021.
• Moreover, the rising company activities in developing advanced software and solutions are also contributing to market growth. For instance, in February 2022, Optum launched Optum Specialty Fusion, a specialty medication management solution, to simplify care for patients with complex conditions and lower the cost of expensive specialty drugs. Specialized Fusion offers payers and providers of healthcare real-time insight into the most efficient specialty treatments at the patient's lowest cost by utilizing Optum's data and clinical experience. Therefore, owing to the factors such as growing health expenditure and increasing demand for prescription drugs, the studied market is expected to grow over the forecast period. However, the reluctance to adopt pharmacy automation systems and stringent regulatory processes on confidentiality are likely to hinder the growth of the pharmacy benefit management market over the forecast period.