OBJECTIVES: Transplantation requires the use of immunosuppressive agents (ISAs) to prevent acute rejection and chronic allograft dysfunction. The purposes of this study were to analyze ISA utilization and expenditure trends in the U.S. Medicaid market. METHODS: Study ISAs included azathioprine (AZA), mycophenolate mofetil (MMF), cyclosporine (CsA), sirolimus (SIR), tacrolimus (TAC), antithymocyte globulin, and monoclonal antibodies. The data source was the national summary file of Medicaid outpatient drug utilization data for the years 1991 to 2007. A retrospective, descriptive trend analysis was conducted to assess the yearly trends in number of prescriptions, reimbursement, reimbursement per prescription, and prescription and reimbursement market shares. RESULTS: The oral ISA prescriptions and reimbursements increased, respectively, from 162,000 and $34 million in 1991 to 719,550 and $251 million in 2005. Meanwhile, the prescriptions and reimbursements of ISA induction antibodies increased from 12 and $9,356 in 1991 to 435 and $548,652 in 2005. Utilization and reimbursement fell in 2006 and 2007. Among oral ISAs, the prescription market share of CsA was 65% in 1991, increased to 97% in 1994, and gradually decreased to 15% in 2007, while the market share of AZA fell from 35% in 1991 to 1% in 1994, and ranged from 13%-30% over the period 1996-2007. Utilization of both TAC and MMF has increased since their introduction; these drugs have dominated the market since 2004. The average per-prescription reimbursement for AZA and CsA has decreased since 1998, while that for MMF, SIR and TAC has increased. CONCLUSIONS: A significant increase in Medicaid expenditure on ISAs may be due to the increased number of transplant recipients and increased ISA prices over time. TAC and MMF dominated the oral ISA market because of their strong efficacy and safety profiles. A significant drop in utilization during 2006-2007 was related to the introduction of Medicare Part D.