Douglas E. Miller, PharmD

Not long ago specialty pharmaceuticals were missing from everyone’s radar and vocabulary. Then, suddenly, they burst on the scene. Based on their high cost and increasing use, the reaction has mimicked that of the astronauts who said, “Houston, we have a problem!” The concern about specialty pharmaceuticals, the common strategies used to manage these important products, and how those strategies can be enhanced are the focus of this paper.

The rising cost of specialty pharmaceuticals continues to cause concern. Over the last 5 years, the cost increases for these agents have averaged 16%.

 Express Scripts reported: “Looking at pharmacy benefi ts alone, 17.6% of total 2011 pharmacy costs among Express Scripts plan sponsors were for specialty medications.”

Although many factors are contributing to this increase, more than half of it is due to increasing unit cost. For the multiple sclerosis agents, the increased cost per year has averaged more than 20% for the past 4 years. However, the real growth in specialty drug costs is hidden, as roughly 47% of overall specialty medication costs are billed under medical benefits.

A recent Specialty Pharmacy Times article titled “Eight mega trends shaping the future of specialty pharmacy” cited the following trends

There is increased drug spending and trend within this category.

There will be more industry consolidation because of patent expiration for small molecule products.

At least 700 new drugs are in the specialty pipeline.

Expectation is for more targeted, tailored, and personalized medicine.

Legislative and regulatory developments will continue to shape the future.

More than 40 biosimilar compounds are in development.

The industry issued 86 copay cards in 2009 and 300 in 2011.

The higher the patient cost for these drugs, the poorer the adherence and the higher the cost for medical, laboratory, and facility use.

article. First, the literature reveals little concern about and little to no publication on the inappropriate use of these agents (surely there is some). Second, because of the complexity of billing for these agents, organizations may be leaving a signifi cant amount of revenue on the table.

The 2 basic approaches for controlling the use of these agents are management strategies and clinical strategies.

Most payers under the pharmacy benefi t have turned to traditional techniques used by pharmacy benefit management companies for managing conventional drugs, like tinkering with the benefi t design, using formulary restrictions, and requiring the use of specialty pharmacies. However, specialty pharmaceuticals are not conventional agents.

Specialty drugs raise complex cost, access, and administrative issues for payers, and do not fit nicely into traditional benefit design structures. Thus, there is inconsistency among payers in coverage, access, and reimbursement. Should specialty pharmaceuticals be placed in the pharmacy or the medical benefit, and how much member cost sharing should be applied?

 Currently, 83% of employers place drugs under the pharmacy benefit.

Increasing the member share of payment for specialty drugs and limiting patients to a 30-day supply have been key management strategies for controlling use.

Specialty drugs fall into 2 distinct categories based on the site and method of administration: those that can be admin istered by either the patient or caregiver and those that require a healthcare professional to administer them in a physician’s office, infusion center, outpatient hospital department, or home. Most payers include self-administered injectables in the pharmacy benefit. There is a large difference in the average monthly cost to a payer for a self-administered injectable compared with the cost for other prescription drugs. For example, self-administered injectables often cost more than $1500 a month, compared with an average of $18 a month for generic drugs and an average of $88 a m onth for brand name drugs.

Formulary Design, Restrictions, and Management 

Two formulary strategies work better than others— listing preferred agents and strict prior approval. About 83% of employers use prior approval for these agents under the pharmacy benefit, but only 37% use prior approval under the medical benefit.

 A moderately effective approach is using step therapy—starting with the most cost-effective and safest drug therapy before progressing to other more costly or risky therapies. Other strategies include restricting quantities, dose, and duration of therapy.

Many health plans require some specialty drugs to be channeled through specialty pharmacy providers. About 72% of employers use a formulary and contracted specialty pharmacy network.

 The most common services provided by specialty pharmacies include direct distribution of drugs to patients and physicians, coordination of reimbursement and eligibility, all-day access to a healthcare professional, and appropriate drug use.

To solve a complex problem, wise proponents seek agreement on the problem before discussing possible solutions.9(p51) From reading the medical literature and listening to the media, one would think the problem is high cost. That is part of the problem, as is a continuing march toward developing more of these agents. However, the other part of the equation is that many patients need these agents and benefit from them. Therefore, the real problem is how to strike a balance between patient access to these agents and controlling inappropriate use.

One study found that “Increased cost sharing for specialty drugs will not reduce their use, but will transfer a greater share of their costs to patients.”

 Therefore, “Care management should focus on making sure that patients who will most likely benefit receive them. Once such patients are identified, it makes little economic sense to limit coverage.”

 However, for many payers, few care management activities have been used, especially if specialty pharmaceuticals are covered under the medical benefit.

 For example, while most specialty pharmacies offer some therapy management service for specific disease categories, fewer than one-third (30%) of payers report using these programs.

 It appears that the patientcentered approaches that health plans reportedly seek to improve adherence and limit unwarran ted use can reap benefits in the form of improved patient outcomes. However, methods to identify inappropriate use and waste are seldom being used.

 Perhaps this is because the incentives are nonexistent or misaligned.

Major clinical strategies for controlling the use of specialty pharmaceuticals include patient-centered management by pharmacists, use of clinical guidelines, performing medication use evaluations (MUEs), and integrating the entire medication use of specialty pharmaceuticals into a single organization structure.

Patient-Centered Management by Pharmacists

URAC (an independent, nonprofit accreditation agency formerly known as the Utilization Review Accreditation Commission) standards for specialty pharmacy accreditation cover a broad range of services, but patient-centered management is the most important standard to fulfill.

 The URAC standards include several medication management requirements that say there should be:

• Strategies and interventions to optimize appropriate therapeutic outcomes for patients through improved medication use based on available information.

• Support for patient advocacy and empowerment to self-administer drugs.

• Initial assessment of appropriate and/or inappropriate drugs.

• Education concerning side effects, drug interactions, food/drug interactions, and safe disposal and other safety precautions such as handling, as well as coordinated development of a care/service plan.

• Monitoring and promotion of medication adherence.

• Effort to minimize the incidence of adverse events.

• Effort to optimize therapeutic outcomes by promoting continuity of care during all patient care transitions and facilitation of collaboration among all the patient’s healthcare providers.

• Self-management and effective use of available clinical and educational resources related to individual patients’ medications.

• Counseling and education related to medication.

• Monitoring for side effects and contraindications.

• Reconciliation, such as for multiple medications.

Articles

Strategies for controlling use of specialty pharmaceuticals should focus on situations where these agents are used inappropriately and on improvement of the complex billing process.