--- title: 4 Ways to Reduce Pharmacy Spend description: Pharmacy spend accounts for a significant portion of an employer’s medical spend. Learn four ways to reduce pharmacy spend and save money. image: https://blog.valenzhealth.com/hubfs/Blog/AdobeStock_442155829-1.jpeg --- [Skip to content](https://blog.valenzhealth.com/4-ways-to-reduce-pharmacy-spend#page-content) [![Valenz Health](https://blog.valenzhealth.com/hubfs/web/logo.svg)](https://www.valenzhealth.com/) - [Who We Serve](https://www.valenzhealth.com/who-we-serve/) - [Solutions](https://www.valenzhealth.com/solutions/member-experience/) - [About Us](https://www.valenzhealth.com/about-us/) - [Resources](https://www.valenzhealth.com/resources/) - [Contact](https://www.valenzhealth.com/contact/) ### [Patients](https://www.valenzhealth.com/who-we-serve/members/) ### Payers - [Employers](https://www.valenzhealth.com/who-we-serve/employers/) - [Taft-Hartley Funds](https://www.valenzhealth.com/who-we-serve/taft-hartley-funds/) ### Providers - [Healthcare Facilities and Providers](https://www.valenzhealth.com/who-we-serve/healthcare-facilities-and-providers/) ### Plans - [Health Plans](https://www.valenzhealth.com/who-we-serve/health-plans/) - [Third-Party Administrators](https://www.valenzhealth.com/who-we-serve/third-party-administrators-tpas/) - [Brokers and Consultants](https://www.valenzhealth.com/who-we-serve/brokers/) - [Stop Loss Producers](https://www.valenzhealth.com/who-we-serve/stop-loss-producers/) #### Partner with Us Discover how Vālenz Health® can simplify the healthcare experience with our innovative solutions. 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With the inflation rate continuing to rise on goods and services such as food, housing, and utilities, out-of-control pharmacy costs are creating an additional dent in employees’ budgets. This is concerning, considering approximately [one out of four adults](https://www.kff.org/health-reform/poll-finding/kff-health-tracking-poll-february-2019-prescription-drugs/) already find it difficult to afford prescription medications. Reducing healthcare costs — especially prescription costs — is essential to relieve the financial burden on employers and employees alike. But what are the best ways to reduce pharmacy spend? In this post, we dig into four of the top strategies to reduce pharmacy costs: ## How to Reduce Pharmacy Spend [Approximately 60% of people](https://www.cdc.gov/nchs/data/databriefs/db470.pdf) between 18 and 64 are prescribed at least one medication. Around 8.2% of those people cannot take the medication as prescribed because of cost. It’s important to ensure employees have what they need to get and stay healthy while reducing prescription costs.  ### Identify Wasteful Medications [Wasteful medications](https://www.commonwealthfund.org/publications/issue-briefs/2019/aug/reducing-wasteful-spending-employers-pharmacy-benefit-plans) are drugs that have little to no clinical value. These include: - Combination drugs that increase costs by combining two ingredients into one drug when the individual active ingredients are cheaper - Prescription drugs when there is an over-the-counter option available - Brand-name, high-cost generic drugs when a low-cost generic is available - A “new” drug created by tweaking an ingredient in an existing drug, adding no additional clinical value. Plan sponsors often use drug formularies with many wasteful drugs because they think members will be disappointed if a prescribed drug isn’t included in the formulary. However, doctors often prescribe these drugs because they aren’t aware of the high cost.  By identifying wasteful drugs and sticking to a formulary that focuses on effective, affordable medications, you can reduce pharmacy spend and benefit both employees and employers. ### Measure the Savings from Wasteful Medications Once wasteful medications have been identified, calculate the potential savings to determine the impact on pharmacy spend. In a study conducted by Pacific Business Group on Health and Integrity Pharmaceutical Advisors about cutting out formulary waste, approximately 868 medications from 71 medication groups [were determined to be wasteful](https://www.commonwealthfund.org/publications/issue-briefs/2019/aug/reducing-wasteful-spending-employers-pharmacy-benefit-plans). The difference in cost between high- and low-cost medications ranged from 25—99.9% per medication, for a total annual savings of $63.3 million. ### Emphasize Preventative Care Employees with chronic conditions account for a higher percentage of healthcare spending. In total, specialty medications accounted for [about 50% of total drug spending in 2021](https://aspe.hhs.gov/sites/default/files/documents/88c547c976e915fc31fe2c6903ac0bc9/sdp-trends-prescription-drug-spending.pdf). [Emphasizing preventative care](https://blog.valenzhealth.com/preventive-care-strategies) and chronic disease management can reduce pharmacy spend. For example, focusing on the early detection of cancer and other chronic diseases can help lower treatment costs. Even employees considered at-risk for a condition but otherwise healthy can benefit from a focus on prevention and early detection. For employees who are already taking medication for a condition, an early prevention focus can reduce comorbidities that lead to high pharmacy spend. ### Implement a Pharmacy Savings Program One of the best ways to reduce pharmacy spend is to implement a pharmacy savings program focused on drastically reducing prescription costs. For example, [Valenz Bluebook Rx](https://www.valenzhealth.com/solutions/member-experience/bluebook-rx/) examines claims data to determine where overpriced medications are being used, then sends a personalized savings report to members with recommendations for lower-cost clinically comparable options.  Members can also receive personal guidance from a licensed pharmacy team. The program can help members potentially save thousands of dollars, and employers millions, by identifying waste and overspending. ## Ready to Reduce Your Pharmacy Spend? Adding [Valenz Bluebook Rx](https://www.valenzhealth.com/solutions/member-experience/bluebook-rx/) to your benefit offering can reduce overall pharmacy spend while improving employees’ well-being. Contact us today to learn more. ### Connect with Us to Learn More     ![Vālenz Health®](https://blog.valenzhealth.com/hs-fs/hubfs/Valenz%20Logo%20Signature.png?width=48&height=48&name=Valenz%20Logo%20Signature.png) [Vālenz Health®](https://blog.valenzhealth.com/author/valenz-health) Vālenz Health® empowers employers, brokers, payers, and providers to reduce costs, improve quality, and elevate the healthcare experience. Our solutions combine advanced technology, clinical expertise, and extensive cost, quality, and utilization datasets to execute across the entire healthcare journey — connecting insights and action for greater transparency, flexibility, and cost containment within a complex system. By helping our customers and members navigate healthcare with confidence, we support smarter care decisions, strengthen plan performance, and deliver better value for everyone we serve. ## Related Articles [![A woman with a chronic health condition takes medication while sitting at a desk. ](https://blog.valenzhealth.com/hubfs/Blog/AdobeStock_600720024%20(1)-1.jpeg)](https://blog.valenzhealth.com/health-conditions-driving-up-healthcare-costs) ### [The Health Conditions Driving Up Healthcare Costs — and What Employers Can Do About Them](https://blog.valenzhealth.com/health-conditions-driving-up-healthcare-costs) For the second year in a row, healthcare costs are expected to rise by 9% for the group market in the United States, according to the latest research by PWC. [Trista Taylor](https://blog.valenzhealth.com/author/trista-taylor) July 02, 2026 [![A female patient holding an injection.](https://blog.valenzhealth.com/hubfs/Blog/AdobeStock_717197856%20(1)-1.jpeg)](https://blog.valenzhealth.com/weighing-the-costs-how-glp-1-weight-loss-drugs-can-save-employers-money-in-the-long-run) ### [Weighing the Costs: How GLP-1 Weight Loss Drugs Can Save Employers Money in the Long Run](https://blog.valenzhealth.com/weighing-the-costs-how-glp-1-weight-loss-drugs-can-save-employers-money-in-the-long-run) The popularity of glucagon-like peptide-1 (GLP-1) weight loss drugs is on the rise, offering transformative health benefits for those struggling with obesity. For employers, these medications present a unique opportunity to improve employee well-being while addressing the substantial financial implications of chronic health conditions. [Vālenz Health®](https://blog.valenzhealth.com/author/valenz-health) January 30, 2025 Share Ready to Simplify Self-Insurance? ## Your Journey Starts Here Connect with a Valenz team member to explore the difference our solutions can make for you. ![Vālenz Health](https://www.valenzhealth.com/wp-content/uploads/2025/05/logo.svg) [![Youtube](https://www.valenzhealth.com/wp-content/uploads/2025/06/Icon-Youtube.svg)](https://www.youtube.com/@valenzhealth) [![Linkedin](https://www.valenzhealth.com/wp-content/uploads/2025/06/Icon-Linkedin.svg)](https://www.linkedin.com/company/valenz/) [Login](https://www.valenzhealth.com/user-login/) [Help Center](https://support.valenzhealth.com/hc/en-us) [Trust Center](https://trust.valenzhealth.com/) [Privacy Policy](https://www.valenzhealth.com/privacy-policy/) Cookie Settings [Cookie Policy](https://www.valenzhealth.com/cookie-policy/) [California Privacy Rights Notice](https://www.valenzhealth.com/california-privacy-rights-notice/) [Terms and Conditions](https://www.valenzhealth.com/terms-and-conditions/) 1717 McKinney Ave, Suite 1000, Dallas, TX 75202, USA | [(866) 762-4455](tel:+18667624455) © 2026 Vālenz Health® ```json { "@context" : "https://schema.org", "@type" : "BlogPosting", "about" : [ { "@type" : "Thing", "name" : "Pharmacy and Prescription Drugs" } ], "articleBody" : "High prescription drug costs impact both employers and employees. With the inflation rate continuing to rise on goods and services such as food, housing, and utilities, out-of-control pharmacy costs are creating an additional dent in employees’ budgets. This is concerning, considering approximately one out of four adults already find it difficult to afford prescription medications. Reducing healthcare costs — especially prescription costs — is essential to relieve the financial burden on employers and employees alike. But what are the best ways to reduce pharmacy spend? In this post, we dig into four of the top strategies to reduce pharmacy costs: How to Reduce Pharmacy Spend Approximately 60% of people between 18 and 64 are prescribed at least one medication. Around 8.2% of those people cannot take the medication as prescribed because of cost. It’s important to ensure employees have what they need to get and stay healthy while reducing prescription costs. Identify Wasteful Medications Wasteful medications are drugs that have little to no clinical value. These include: Combination drugs that increase costs by combining two ingredients into one drug when the individual active ingredients are cheaper Prescription drugs when there is an over-the-counter option available Brand-name, high-cost generic drugs when a low-cost generic is available A “new” drug created by tweaking an ingredient in an existing drug, adding no additional clinical value. Plan sponsors often use drug formularies with many wasteful drugs because they think members will be disappointed if a prescribed drug isn’t included in the formulary. However, doctors often prescribe these drugs because they aren’t aware of the high cost. By identifying wasteful drugs and sticking to a formulary that focuses on effective, affordable medications, you can reduce pharmacy spend and benefit both employees and employers. Measure the Savings from Wasteful Medications Once wasteful medications have been identified, calculate the potential savings to determine the impact on pharmacy spend. In a study conducted by Pacific Business Group on Health and Integrity Pharmaceutical Advisors about cutting out formulary waste, approximately 868 medications from 71 medication groups were determined to be wasteful. The difference in cost between high- and low-cost medications ranged from 25—99.9% per medication, for a total annual savings of $63.3 million. Emphasize Preventative Care Employees with chronic conditions account for a higher percentage of healthcare spending. In total, specialty medications accounted for about 50% of total drug spending in 2021. Emphasizing preventative care and chronic disease management can reduce pharmacy spend. For example, focusing on the early detection of cancer and other chronic diseases can help lower treatment costs. Even employees considered at-risk for a condition but otherwise healthy can benefit from a focus on prevention and early detection. For employees who are already taking medication for a condition, an early prevention focus can reduce comorbidities that lead to high pharmacy spend. Implement a Pharmacy Savings Program One of the best ways to reduce pharmacy spend is to implement a pharmacy savings program focused on drastically reducing prescription costs. For example, Valenz Bluebook Rx examines claims data to determine where overpriced medications are being used, then sends a personalized savings report to members with recommendations for lower-cost clinically comparable options. Members can also receive personal guidance from a licensed pharmacy team. The program can help members potentially save thousands of dollars, and employers millions, by identifying waste and overspending. Ready to Reduce Your Pharmacy Spend? Adding Valenz Bluebook Rx to your benefit offering can reduce overall pharmacy spend while improving employees’ well-being. Contact us today to learn more. Connect with Us to Learn More", "articleSection" : [ "How to Reduce Pharmacy Spend", "Identify Wasteful Medications", "Measure the Savings from Wasteful Medications", "Emphasize Preventative Care", "Implement a Pharmacy Savings Program", "Ready to Reduce Your Pharmacy Spend?" ], "author" : { "@id" : "https://blog.valenzhealth.com/author/valenz-health", "@type" : "Person", "name" : "Vālenz Health®", "url" : "https://blog.valenzhealth.com/author/valenz-health" }, "dateModified" : "2025-12-18T11:49:46-05:00", "datePublished" : "2022-09-05T07:45:00-04:00", "description" : "Pharmacy spend accounts for a significant portion of an employer’s medical spend. 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