The U.S. health care system should be very grateful for over-the-counter medications, according to a new study—because those meds save the system nearly $146 billion—that's billion with a “b”—every year.

The Value of OTC Medicines to the U.S. Health Care System joint study, from IRI and the Consumer Health Products Association, finds that for every dollar spent on OTC medicines, an average of $7.20 is saved by the U.S. health care system. The study arrived at those numbers by considering “direct and indirect savings, driven by access to self-treatment and substitution of OTC products for prescription drugs,” the report says.

In reviewing survey responses from consumer participants in IRI's National Consumer Panel, the study found that direct cost savings accruing from the availability of OTC medicine originate in two primary sources: substituting lower-priced OTCs for expensive prescription drugs and substituting self-treatment for clinical visits. IRI and CHPA found that these two primary impacts of OTC drug availability contribute nearly $52 billion and $95 billion, respectively, in savings per year.

“Our study results show that the value created by the availability of OTC products is hard to overstate,” says Scott Melville, president and chief executive officer of CHPA. “Beyond the $146 billion our study quantified in direct savings, OTC products also provide substantial indirect value by affording increased productivity through fewer missed work days and the expansion of treatment access to 27 million Americans who would otherwise forgo treatment if OTCs were not available.”

The study's estimation of savings from unnecessary clinical visits arises from its finding that nearly 90 percent of consumers who treat a condition with an OTC medicine would seek professional medical treatment if OTC options were not available.

“It is clear that OTC medicines help reduce the overall burden on the U.S. health care system by promoting consumer self-care and in turn provide health care practitioners with the incremental time and resources to invest in the diagnosis and treatment of more serious ailments and conditions,” says Navin Gautam, executive, Client Insights, IRI.

The study also found that 61 percent of the total OTC savings from drug costs, or the price difference between the OTC products and their prescription counterparts, come from OTC products used to treat ailments in three categories: medicated skin, lower GI and upper GI.

In addition, 13 million Americans treating allergies with OTC meds would go without treatment if they had no nonprescription options to turn to.

Then there are workplace productivity benefits, the study found, that amount to some $34 billion in potential workplace productivity that would be lost each year to accommodate workers missing hours while seeking treatment or getting a prescription if they couldn't rely on OTC products.

A range of OTC medical devices and products to treat ailments such as pain relief, foot comfort and care, heat/ice packs, muscle stimulators and asthma inhalers add up to $7.7 billion in costs every year for treatment and testing that can be avoided because of OTC availability.

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Instant Insights /

Over-the-counter drugs have a billion-dollar impact on the bottom line

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