Background: Studies documenting high costs of cancer drugs often focus on targeted therapies as a whole without differentiating between oral and intravenous agents; such distinction is important because they differ in insurance design. Our study examined recent trends on targeted oral anticancer medications (tOAMs), and targeted IV anticancer medications (tIVAMs) and explored the cost drivers. Methods: We classified cancer drugs as tOAMs, tIVAMs, and non-targeted agents. Using the 2002-2011 LifeLink Health Plan Claims Database, we described trends in utilization and in insurance payments and out-of-pocket (OOP) costs per patient per month (PPPM) and during the first year of systemic therapy among privately insured non-elderly cancer patients. We performed Cochran-Armitage tests and generalized linear models to test the statistical significance of utilization and cost trends, respectively, and conducted decomposition analysis to disaggregate the cost trend into the increase driven by therapeutic substitution to more expensive classes of drugs vs. increases in drug prices over time. Results: Targeted therapies accounted for 11% of all systemic therapy utilization and 22% of systemic therapy expenditures in 2001, increasing to 42% (28% tIVAMs and 14% tOAMs) of utilization but 63% (38% tIVAMs, 25% tOAMs) of expenditures in 2011. Insurance payments PPPM for tOAMs more than doubled in ten years, growing from $3,381 PPPM in 2001 to $7,370 in 2011 (P < 0.001), whereas PPPM for tIVAMs remained fairly constant (around $7,000) throughout. Decomposition analyses of two time periods (2001-2005 and 2005-2010) showed that switching to more expensive classes of drugs accounted for the large majority of cost increase. Post-launch price increases contributed a 10-11% of spend increases during the two periods, while the increase in launch price accounted for 6% and 15% of spending growth, respectively, for each period. Conclusions: Payers should consider more aggressive management of pharmacy benefits for tOAMs and payment reforms for injectable drugs to contain the rising costs of cancer care.