Hospitals and pharmacies competing for drug revenue will become a long-term trend

Although the separation of medicine has always been a tradition in the medical system of Western countries, with the evolution of the disease spectrum and the reform of the medical system, medical institutions have increasingly returned to the mode of medical integration, which will have a profound impact on the entire market.

The core appeal of the separation of medicine is to establish a firewall between the benefits of medicine and medicine, and to prevent medical institutions from over-medicating in order to obtain more medicine benefits.

Taking the US market as an example, according to the American Society of Hospital Pharmacists survey, as of 2018, 76% of large hospitals with more than 600 beds in the United States have established in-hospital specialty drug pharmacies.

Hospitals entering outpatient drug retailing are mainly affected by two reasons: hospitals have demand for profit from drugs after being impacted by the payer, and value-added hospitals have demand for improvement of medical quality.

First of all, in the case of loss of profits, the hospital hopes to profit from medicines.

As more and more hospital users flow out of the hospital, the hospital has also begun to enter the out-of-hospital market of rehabilitation, nursing and outpatient services through mergers and acquisitions and new construction.

As hospitals begin to enter the outpatient field on a large scale, hospitals are increasingly relying on these outpatient institutions to sell drugs for profit.

However, even with Medicare coverage, dozens of drugs in the head account for most of the expenses due to high drug prices.

Therefore, although the prescription of outpatient drugs in the United States still needs to go through PBM, because it occupies the core usage scenario of prescription, hospitals are grabbing the market share of out-of-hospital pharmacies on expensive drugs.

Secondly, value medical hospitals have a demand for improvement of medical quality.

Of course, judging from the inefficiency of the out-of-hospital system in the United States, the efficiency of in-hospital pharmacies is relatively high, which is indeed beneficial to the treatment of patients.

However, the core demand of the hospital is to keep the income from expensive drugs in the hospital, which is in conflict with the PBM and insurance companies that own a large number of specialty drug pharmacies.

Following the merger of insurance companies and PBMs in the past five years, the conflict between insurance companies and hospitals has emerged.

With the expansion of the expensive drug market in the future, the contradiction between hospitals and some insurance companies will be further intensified.

As one of the countries with the highest income from medical services in the world, American hospitals continue to expand the market for in-hospital pharmacies under pressure.