* Foodservice estimate extracted from Bureau of Labor Statistics

** Beginning with this issue of the Inflation Indices, pharmaceutical inflation figures will be derived from Premier’s Drug Budget Development Tool. The drug budget development tool analyzes the top 85 percent of drug purchases, both on-contract and non-contract items based on July 2008 through June 2009 member purchases. Estimates of inflation indices for each line item are based on July 2008 to July 2009 prices corrected for the recent generic bid roll, recent changes in contract prices, and anticipated first-time generic approvals. Inflation figures are updated monthly and the tool is recalculated semiannually. The drug budget development tool and instructions for its use are available on Premier’s Web site at www.premierinc.com/pharmacy. Click on Contracting and look for the budget tool button in the left navigation bar. The tool is used with SpendAdvisor™ to analyze over 80 percent of your on- and non-contract items. The total time to run SpendAdvisor™ and the tool is generally less than 10 minutes.

PLEASE NOTE: The range of increases is based on the high and low supplier estimate for the various products within the category. The range does not take into account Premier contract price protection or utilization data. The Supplier average percent increase is based on a true average, while the Premier average is a weighted average.

Sources of information

The inflationary estimates are intended to reflect industry-wide changes only. Based on contractual price protection and ongoing negotiations, the impact on Premier members should be less than industry predictions.