Pharmacy Benefit Management Market size is anticipated to reach USD 700 Billion by the end of 2033, growing at a CAGR of 6% during the forecast period, i.e., 2023-2033. In the year 2022, the industry size of pharmacy benefit management was USD 500 Billion. Rising healthcare expenditure and a radical upsurge in the prevalence of various types of chronic diseases are estimated to boost market growth during the forecast period. The national healthcare expenditure of the U.S. raised to 9.7%, i.e., to 4.1 trillion in 2020. Chronic diseases include diabetes, hypertension, stroke, heart disease, cancer, arthritis, obesity, oral disorders, and respiratory diseases. All these last more than one year and may lead to hospitalization and death eventually. Chronic diseases usually occur in the aged population, as they are immune compromised. These types of diseases affect the quality of life and require continuous medication intake as the only remedy, and it is anticipated to increase the growth of the market.
Pharmacy benefit management aids to provide medical services and drugs at the cheapest price to employers through insurance companies. More customers are attracted to PBM services to increase their access to many pharmaceuticals and retail pharmacies. Further, the availability of many drugs with the same composition of APIs in the pharmacy benefit management market makes it difficult for the manufacturers and consumers owing to the slightest difference in prices of these drugs. Besides this, the adoption of ML (machine learning) and AI (artificial intelligence) in dispensing pharmacies to reduce manual errors is expected to fuel the growth of the market. For instance, as per observations, out of 100,000 prescriptions, a hospital pharmacist makes an overall average of 5 errors.
Growth Drivers
Challenges
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Base Year |
2022 |
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Forecast Year |
2023-2033 |
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CAGR |
~6% |
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Base Year Market Size (2022) |
~ USD 500 Billion |
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Forecast Year Market Size (2033) |
~ USD 700 Billion |
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Regional Scope |
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Service (Specialty Pharmacy Services, Drug Formulary Management, Benefit Plan Design & Consultation, Other Services)
The global pharmacy benefit management market is segmented and analyzed for demand and supply by service into specialty pharmacy services, drug formulary management, benefit plan design & consultation, and other services. Out of which, specialty pharmacy services are anticipated to hold the largest market size by the end of 2033 on the back of the rising prevalence of complex and chronic diseases that require a profound time to be treated. For instance, more than 50% of Americans had at least one chronic condition and more than 27% of U.S adults had multiple chronic conditions in 2020. The instance of two or more chronic conditions is a rising issue across the world. More people, especially the old age population, are suffering from these multimorbidity disorders. In addition, the combination of diseases increases the risk of death for these people. Increasing longevity is also the reason for the incidence of chronic disorders. The incidence of diabetes leads to lower immunity, reduced healing power, and higher chances of the occurrence of diseases such as hypertension, heart disorders, and renal failure.
End-user (Pharmacy Benefit Management Organization, Mail Order, Retail, Inpatient, Outpatient Pharmacies)
The global pharmacy benefit management market is also segmented and analyzed for demand and supply by end-user into pharmacy benefit management organization, mail order, retail, inpatient, and outpatient pharmacies. Amongst these segments, the retail pharmacies segment is expected to garner a significant share, as it is the fastest-growing industry around the world. Moreover, the increasing availability of credit for people impacts their purchasing capacity of the customers. Therefore, retail pharmacists build customer relationships which makes them rely more on retail stores. Trust is built between them as direct human contact gives more confidence to the consumer while purchasing medicines from the such pharmacy. Also, retail pharmacies deliver medicines immediately and without delay in front of the consumer. This increases the loyal customer rate in retail pharmacies. The number of retail pharmacies in the U.S. in 2021 was about 60,000 out of a total count of 67,000 pharmacy facilities, as per the estimations.
Our in-depth analysis of the global market includes the following segments:
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By Service |
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By Business Model |
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By End-User |
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North American Market Forecast
The North America pharmacy benefit management market, amongst the market in all the other regions, is projected to hold the largest market share by the end of 2033. The growth of the market can be attributed majorly to the account of elevating penetration of online pharmacies. For instance, as per the estimations, the number of adults who use web-based prescription filling notably has increased from 6% in 2009 to 12% in 2018 in the United States. Furthermore, escalating adoption of advanced healthcare solutions along with the existence of a well-established health industry are some other growth factors that are propelling the market growth in the region. The rising modernization and digitalization of everything improved the healthcare industry a lot. The increasing penetration of e-commerce software and platform in every sector also impacts the growth of the market segment. Moreover, pharmacists are responsible for the proper dispensing of drugs, as any small error in drug dispensing will lead to several complications. Sometimes the handwritten prescriptions of doctors can be unreadable, and on the other hand, the online prescription is clearly visible with a good font. Also, all the drug-related information, such as dosage, administration route, therapeutic use, contraindications, and side effects, is available on online platforms. All these help any nonmedical person to understand the condition of their help. The increasing advantage of online prescriptions impacts the growth of the market in the region during the forecast periods as per the pharmacy benefit management market analysis.
CVS Health Corporation designed a Vendor Benefit Management service to help the customers of CVS Caremark Pharmacy Benefit Management and announced its availability to manage, contract, and implement their choice of health benefit solutions in the digital and non-digital platforms.
Rite Aid Corporation’s subsidiary Elixir announced the introduction of a specialty generic enhancement to the clients of copay solutions to provide them with specific specialty medications at USD 0 copay to save USD 40,000 every year.
Author Credits: Radhika Gupta, Shivam Bhutani
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