Report Overview

According to the deep-dive market assessment study by Growth Plus Reports, the global pharmacy benefit management market was valued at US$ 480 billion in 2021 and is expected to register a revenue CAGR of 5.3% to reach US$ 764 billion by 2030.

Pharmacy Benefit Management Market Fundamentals

Pharmacy benefit management is a group of drug advisors that oversees, investigates, and manages all issues pertaining to healthcare and provides businesses with the benefits of drug programs. The pharmacy benefit management (PBM) industry consists of businesses that function as liaisons between insurance providers, pharmacies, and pharmaceutical producers. Additionally, it helps provide management, medical services, and biological drugs at lower prices. The cost deduction is achieved through drug manufacturer refunds, pharmacy contracts, creation and payment of prescription drug claims, and employment with self-protected associations and government programs.

Benefit management releases a list of medications that includes all prescriptions contained within the names of its benefit plans, at which time manufacturers can offer rebates. Pharmacy benefit management can vary and flex in size from a little to huge. A few of the business areas of the pharmacy benefit manager include examining clinical lineups for a large population, finding affordable therapeutic alternatives, and learning about tablet splitting and drug therapy management systems.

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Pharmacy Benefit Management Market Dynamics

A set of businesses known as pharmacy benefit management acts as a go-between between insurance companies and drug makers & pharmacies to minimize prescription costs for insurance companies and insurers. The prevalence of numerous chronic diseases is significantly increasing across the globe. This is one of the main factors driving revenue growth in the pharmacy benefit management market. Diabetes, cardiovascular disease, respiratory disease, and cancer are a few of the illnesses that can lead to the greatest fatalities.

The global pharmacy benefit management market is expanding at a significant pace in developed and developing countries, as these countries are significantly increasing their healthcare expenses and spending. Global demand for prescription pharmaceuticals is increasing owing to rising healthcare costs and the cases of chronic diseases. This factor is fueling the need for pharmacy benefits management services.

The increasing usage of benefit management services by pharmacies, pharmaceutical companies, and insurance providers is leading to a shift in the service providers' preferences from the traditional flow of work to the development of workflow using machine learning. Associations can provide a top-notch supply chain, quick mail order delivery, and supply to a large number of coverage and product pharmacy linkages within the allotted time.

Healthcare costs are rising due to higher drug costs worldwide, which is a significant factor in emphasizing the need for pharmacy benefit management services among healthcare insurance providers. Increased usage of pricey medications for rare diseases has resulted in rising healthcare costs. This, in turn, is fueling revenue growth in the market. The demand for pharmacy benefit management services among health insurance providers is expected to increase due to the growing market penetration of health insurance providers and increased consumer awareness about the advantages of health insurance. Drug companies, retail pharmacies, and health insurance companies are adopting pharmacy benefit management services, which is changing the service providers' inclinations in favor of cutting-edge workflows that make use of machine learning technologies. The adoption of artificial intelligence and machine learning technologies in pharmacy benefit management services is expected to present expansion opportunities for market players.

However, key challenges impeding market revenue growth include regulatory burdens and unwillingness to use pharmacy automation technologies.

Pharmacy Benefit Management Market Ecosystem

The global pharmacy benefit management market has been analyzed from three perspectives: service, service provider, and region.

Pharmacy Benefit Management Market by Service

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Based on the service, the global pharmacy benefit management market is segmented into specialty pharmacy, benefit plan & administration, formulary management, pharmacy claims processing, and others. 

The specialty pharmacy segment accounts for the largest revenue share of the global market. The demand for specialty pharmacy is increasing due to rising prevalence of rare and chronic diseases. Most patients cannot afford the hefty costs of specialist medications. As a result, the need for pharmacy benefit management services is rising to lower the cost of these specialty pharmaceuticals and make them more affordable to patients. These factors contribute to the segment’s revenue growth.

Pharmacy Benefit Management Market by Service Provider

Based on the service provider, the global pharmacy benefit management market is segmented into insurance companies, retail pharmacies, and standalone pharmacy benefit management providers. 

The insurance companies segment dominates the global pharmacy benefit management market. The primary reason for this segment's dominance in the global pharmacy benefit management market is the increase in mergers and acquisitions between insurance firms and suppliers of pharmacy benefits management services. For instance, a three-year agreement for pharmacy benefit management services was established between First Medical Health Plan, Inc. and Abarca Health LLC. Furthermore, the industry is greatly fueled by the growing presence of health insurance providers in developed and developing countries.

Pharmacy Benefit Management Market by Region 

Based on the region, the global pharmacy benefit management market is segmented into North America, Europe, Asia Pacific, and the Rest of the World. 

North America dominates in terms of revenue share in the global pharmacy benefit management market. The presence of leading insurance companies, pharmaceutical manufacturers, pharmacy benefit management service providers, and retail drugstore chains in the U.S. and increase in the usage of health insurance policies by the U.S. population are driving revenue growth in the North America market. According to estimates, more than half of the U.S. population has one or more chronic illnesses. The high cost of healthcare and the rising usage of insurance policies have fueled the expansion of the North America pharmacy benefit management business. According to the Centers for Medicare and Medicaid Services, the total cost of healthcare in the U.S. increased to US$ 4.1 trillion in 2020, up 9.7% from the year before. The region's extensive usage of health insurance companies has fueled the expansion of the North American pharmacy benefit management business. Most patients in the U.S. rely on reimbursements to pay for their medical care for various conditions. The market's rise in North America has also been aided by favorable reimbursement policies in the region.

Pharmacy Benefit Management Market Competitive Landscape

The prominent players operating in the global pharmacy benefit management market are:

• UnitedHealth Group Incorporated 
• Rite Aid Corporation 
• Express Scripts Holding Company 
• Benecard Services, LLC
• CaptureRx
• Change Healthcare 
• Anthem, Inc.
• CVS Health 
• SS&C Technologies, Inc.
• ProCare Rx

Pharmacy Benefit Management Market Strategic Developments

• In January 2022, Centene Corporation successfully acquired Magellah Health, Inc. to provide integrated healthcare solutions that deliver better outcomes at lower costs
• In May 2020, Anthem, Inc. unveiled IngenioRx, a cutting-edge pharmaceutical benefit manager. It uses the digital-first strategy and clinical knowledge to tailor the members’ experiences. This plan aimed at expanding consumer and revenue reach.

Frequently Asked Questions About This Report