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Commercial health insurance plans use formulary tiering and utilization management (UM) to manage drug spending and ensure appropriate use of prescription drugs. In tiered formularies, each covered drug is placed on one of multiple formulary levels by the plan or pharmacy benefit manager (PBM). Lower tiers (e.g., preferred drug tiers) have lower cost sharing than higher tiers (e.g., non-preferred or specialty tiers). UM techniques include prior authorization (PA), in which a prescriber is required to demonstrate why a patient needs a particular drug, and step therapy (ST), whereby a patient is required to try one drug before they can access another (often requiring a lower-tier drug before a higher-tier drug).

Avalere Health examined coverage and UM of single-source brand drugs in the commercial insurance market from 2016 through 2025 to identify trends over time. The study included employer-sponsored plans (self- and fully-insured) and health insurance exchange plans. Coverage, formulary tier placement, and UM were reviewed across eight therapeutic areas (TAs) across five types of conditions:

• Mental health:
  • Antidepressants
•  Endocrine:
  • Diabetes – glucagon-like peptide-1 (GLP-1)
  • Sodium-glucose co-transporter-2 (SGLT-2)
•  Neurology:
  • Migraine
  • Multiple sclerosis (MS)
• Autoimmune:
  • Psoriasis
  • Rheumatoid arthritis (RA)
• Oncology:
  • Multiple myeloma (MM)

In this analysis, we considered the percentage of covered lives for whom only ST is required, only PA is required, any UM (ST and/or PA) is required, and coverage with open access (i.e., no UM required). Formulary tier placement is displayed through the distribution of enrollment by drug formulary tier (e.g., preferred tier, non-preferred tier, specialty tier). This analysis included single-source drugs, defined as Food & Drug Administration-approved brand products made by one manufacturer.

This analysis included all single-source brand drugs that were listed in Clarivate data for at least one year during the analysis period. It included 146 single-source brand drugs, ranging from eight to 34 across the TAs. As drug inclusion was tied to single-source status, the drug list varies by year. Additional detail can be found in the Methodology section below.

Key Findings

1. Coverage of single-source brands decreased by more than 20 percentage points for the included TAs (in aggregate) from 2016–2025, across commercial markets (Table 1).
2. Rates of utilization management on covered drugs have increased by 14 percentage points, on average, across the included TAs during the same timeframe (Figure 1).
3. Across the study window, employer coverage was more generous (i.e. drugs were covered more frequently, and covered drugs have lower rates of UM), on average, compared to exchange coverage.

Table 1. Coverage in 2016 and 2025, and trend in coverage year over year, single-source brand drugs

Figure 1. UM status (percentage of time UM was required, of covered lives), 2016-2025, single-source brand drugs

Note on how coverage, tiering and utilization management are measured in this analysis:

This analysis examined how frequently single-source brand drugs within a therapeutic area were covered, not covered, subject to utilization management, and placed on specific formulary tiers in commercial plans from 2016 through 2025. Avalere Health calculated the number of plan-lives with each coverage, tiering and UM characteristic divided by the total number of drug-plan lives (the total number of plan lives multiplied by the total number of drugs). Each data point reflects multiple drugs and multiple formularies, weighted by enrollment in the plans that use each formulary. Throughout the paper, results are reported as the “percent of the time.” This measure accounts for differences in plan enrollment and represents the share of enrollees who would be subject to a given formulary feature (e.g., coverage, tier placement, UM requirements) when seeking access to single-source brand drugs in the therapeutic areas studied.

Methodology

Formulary Analysis: Avalere Health used 2016–2025 Clarivate formulary data to analyze plan formularies across eight TAs (i.e., Antidepressants, GLP-1s, Migraine, MM, MS, Psoriasis, RA, and SGLT-2s). The formulary data came from the commercial insurance market, which includes fully insured and self-funded employer-sponsored insurance and exchange plans. Formulary data reflects the status in March of each respective year. All results are enrollment weighted. The analysis focused on commercial plans, which include plans labeled by Clarivate as commercial, employer, federal employee health benefits, other federal programs, health insurance exchange, municipal, and union health plans. For our analysis, “health insurance exchange” plans are captured in the exchange group; all other commercial types are considered employer coverage.

Drugs Included: Avalere Health assessed single-source brand drugs in eight TAs. Single-source brands are drugs that are only available from one manufacturer (i.e., drugs without a generic available). Single-source brand drugs were identified using Medi-Span reference files from 2016-2025 to determine whether each product in a class was a single-source brand, a multi-source brand, or a generic drug. Due to new drug entrants and the appearance of generics, the drug lists for each TA vary by year. New single-source drugs were added to the sample across TAs as they became available. Some products were removed from the single-source brand sample as they lost single-source status (i.e., as generics or biosimilars became available).

Coverage Calculation: The sum of percent covered and percent not covered may not add up to 100% due to certain drugs classified as “N/A” or “Excluded” in Clarivate’s data. Outputs examine how frequently single-source brand drugs in the selected TAs were covered, not covered, subject to UM, or placed on various tiers when looking across the studied formularies. Given that each data point reflects multiple drugs and multiple formularies—as well as the enrollment in plans that use each formulary—the resulting figures capture the frequency of these measures of formulary coverage (noted as “percent of the time”). This approach considers which formularies have higher enrollment and indicates the share of individuals insured on commercial plans who would be subject to a specific formulary feature like UM if they sought coverage for single-source brand drugs in the studied TAs.

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Prepared for Let My Doctors Decide Action Network. Avalere Health retained full editorial control.