The global Pharmacy Benefit Management Market is estimated to be valued at US$ 858.38 Bn in 2023 and is expected to exhibit a CAGR of 6.0% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Market Overview:
The pharmacy benefit management market involves services that manage prescription drug benefits on behalf of health insurers, employers, unions and government health programs. This includes developing lists of covered/excluded drugs (formularies), negotiating discounts from pharmaceutical manufacturers, processing and paying prescription drug claims from pharmacies, and developing programs to encourage appropriate medication use. The market offers various advantages such as increased client retention for insurance companies, lower prescription drug costs for employers and reduced costs for consumers. The growing awareness among people regarding the availability of healthcare insurance plans is driving the need for pharmacy benefit management services.
Market key trends:
The pharmacy benefit management market is witnessing increasing adoption of digital platforms and advanced technologies such as artificial intelligence and machine learning. This helps improve cost savings through better management of prescription drug claims and clinical outcomes. For instance, AI-powered tools analyze prescription patterns, formulary changes and pricing trends to suggest lower cost therapeutic alternatives and prevent waste. Blockchain technology is also being used to securely store and share medical records and prescription histories across healthcare organizations. This streamlines the payment process and supports value-based reimbursement models. As a result, many leading pharmacy benefit managers are focusing on enhancing their IT infrastructure to offer innovative digital solutions and apps to clients and patients.
Porter’s Analysis
Threat of new entrants: The threat of new entrants is moderate. High capital requirements and economies of scale in operations make it challenging for new players to enter the market.
Bargaining power of buyers: The bargaining power of buyers is high due to the presence of a large number of pharmacy benefit management companies. Buyers can negotiate on price and quality of services.
Bargaining power of suppliers: The bargaining power of suppliers is moderate. Major suppliers of drugs and medications have considerable influence on pharmacy benefit managers.
Threat of new substitutes: The threat of substitutes is low as there are limited alternatives to pharmacy benefit management services.
Competitive rivalry: The competitive rivalry in the market is high due to the presence of established players. Companies compete based on service quality, technology, pricing and innovation.
Key Takeaways
The Global Pharmacy Benefit Management Market is expected to witness high growth, exhibiting CAGR of 6.0% over the forecast period, due to increasing healthcare expenditure and rising demand for cost-effective medical plans. The market size for 2023 is estimated to reach US$ 858.38 Bn.
North America dominates the global pharmacy benefit management market owing to the significant presence of pharmacy benefit management companies and advanced healthcare infrastructure in the region. Asia Pacific is expected to exhibit fastest growth due to growing medical tourism industry and rising healthcare spending in the region.
Key players operating in the pharmacy benefit management market are CVS Health, SS&C Technologies, Inc.,Anthem Inc., Medimpact, Express Scripts Holding Company, Benecard, Services, LLC, CaptureRx Inc., Change Healthcare, OptumRx, Inc., Cigna. Major players are focusing on strategic collaborations and new product launches to gain competitive advantage in the market.
