Laura Joszt

Costs remain the top concern of healthcare purchasers of pharmacy benefits, but employers are also concerned with ensuring appropriate use of medication

and adherence to medication, according to a new report from the Pharmacy Benefit Management Institute (PBMI).

The eighth Trends in Specialty Drug Benefits includes findings from a survey of 306 respondents responsible for managing the drug benefit for their organization.

Specialty drug spend currently accounts for half of the total drug spend, which creates challenges for employers who want to ensure employees have access to medications. However, with costs rising, employers are also interested in evidence that these medications provide value, which can be gained through new reimbursement arrangements.

Outcomes-based contracts provide the ability to track patient outcomes, with 67% of respondents using these arrangements to track total healthcare cost of patients receiving specialty drugs, 63% tracking adherence and persistency, and 27% tracking clinical efficacy. Less than 10% are tracking the impact of medications on employee productivity.

“Timely, accurate, and actionable reporting is key to measuring how a plan is doing in terms of specialty drug benefit management,” according to the report. “When done well, reporting can highlight areas of opportunity to improve clinical and financial outcomes.”

While nearly all (94%) of respondents said their pharmacy benefit manager (PBM)/healthcare vendor tracks specialty and nonspecialty drug spend under the pharmacy benefit, only half said they are tracked under the medical benefit.

Of respondents whose PBM/healthcare vendor tracks specialty drug spend, 63% of respondents said they can effectively track adherence and persistency, but 34% said they cannot and would like that ability. Furthermore, only 27% can track clinical efficacy and 66% said they cannot and would like the ability.

Respondents were asked an open-ended question of what other outcomes they were interested in tracking, and responses included adverse events and side effects, impact of high-deductible plans and coinsurance on outcomes, long-term cost avoidance by drug, and clinical alternatives and cost impact.

The survey found that respondents are less interested in using formulary exclusions to manage the specialty trend. In the 2018 report, the number of respondents who think exclusions are effective declined 21%. However, this belief does not mean formulary exclusions are going anywhere. Sixty percent of respondents said they use formulary exclusions and 33% are considering adding or increasing their use.

Close to half (42%) of respondents said member dissatisfaction was the number 1 challenge with formulary exclusions, while 27% named it the number 2 challenge.

“Plan sponsors continue to use the traditional drug management levers of utilization management, clinical programs, formulary, and cost-sharing, but remain open and willing to be part of conversations that explore new ways to rein in specialty costs while providing a quality and affordable specialty drug benefit,” according to the report.

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Costs remain the top concern of healthcare purchasers of pharmacy benefits, but employers are also concerned with ensuring appropriate use of medication and adherence to medication, according to a new report from the Pharmacy Benefit Management Institute (PBMI).

Specialty Drugs Remain a Costly Concern for Employers With No Easy Answers

A policy from the Trump administration to benefit patients and alleviate the high cost of prescription drugs would eliminate rebates from pharmaceutical

companies to pharmacy benefit managers. However, there is still a lot of uncertainty around the rule, how it might actually benefit patients, how others in the industry might change behavior, and if January 1, 2020, is enough time to make these changes go live.  

At Asembia’s 15th annual Specialty Pharmacy Summit, held April 30 to May 2 in Las Vegas, Nevada, 2 speakers from Deloitte Consulting LLP outlined what models are expected to result from the changes to rebates and how they will affect various stakeholders in healthcare.

The proposed rule would do away with retrospective rebates and require that they happen at the point of sale (POS), so patients benefit, explained George Van Antwerp, managing director at Deloitte. There are 2 models being discussed that would replace the current rebate system: a POS rebate model and an upfront negotiated discount price (NDP) model.

Van Antwerp and his colleague, Joseph M. Coppola, also a managing director at Deloitte, focused on the NDP model. Under this model, the manufacturer and PBM still agree on a formulary position, but it is based on the NDP instead of a rebate, like it is today. The pharmacy is reimbursed at NDP plus a dispensing fee, and the out-of-pocket cost to the patient is based on the NDP instead of the wholesale acquisition cost (WAC).  

However, as part of that model, the pharmacy is out money, Coppola noted, because it is still acquiring the product at WAC.

“So, there needs to be some making the pharmacy whole,” he said. “But the mechanism by which they would be made whole is still unknown.”

He said the transaction processor who could fill that role might be played by PBMs or a wholesaler or Amazon—no one knows just yet.

According to Coppola, they expect that the new NDP model will accelerate biosimilars to the market because of the focus on the lowest price. Innovative therapies will also have an easier time getting access to patients.

“If you think about this rebate wall that exists today...if that goes away...the implications of that is that it opens the door, it levels the playing field for more innovative therapies to gain access to formulary,” he said.

For the PBMs, there is going to be a shift in business model as pools of revenue and profit from rebates disappear, said Van Antwerp.

While the government policy to eliminate rebates would only affect Medicare, there is the very real possibility that it could spill over into the commercial space or into Medicaid, he added. Without those rebates, there could be an increase in premiums from as little as 1% to as much as 25%, depending on which study you look at and what assumptions are used.

“The point is there will be some impact,” he said. “Rebates have been used to keep everybody’s cost, even the healthy people, down. Now you’re going to see only the people that have high brand usage [or] high specialty usage really be the people who see the benefit of the rebate, because they’re going to go directly to

Already, there is proposed legislation in the House about eliminating rebates in the commercial space, and states will look to drive that change even faster than the federal government, Van Antwerp said. He expects to see more adoption of POS programs in the commercial world.

There remains a lot of uncertainty around the policy, such as that January 1, 2020, start date; who can administer chargebacks to pharmacies; and whether or not pricing will come down. Van Antwerp also noted that this rule might be the end of value-based contracting as we know it because those contracts are very retrospective and tied to outcomes. There might need to be a caveat that those contracts are not part of the change.

“I think it’s an exciting time for those of you who like disruption and like being able to take advantage of the market changes,” Van Antwerp said. “What exactly will happen, how fast it will happen...is still up in the air.”

A policy from the Trump administration to benefit patients and alleviate the high cost of prescription drugs would eliminate rebates from pharmaceutical
companies to pharmacy benefit managers.

Rule Eliminating Rebates Leaves Plenty of Uncertainty

The incidence of acute myeloid leukemia (AML) increases as people age, but the disease can often appear suddenly in patients, without any detectable early symptoms. However, new research has identified the origins of AML, which can be detectable more than 5 years before the disease develops.

 found that blood tests can reveal the roots of AML in healthy patients by looking for changes in DNA code.

“We have been able to identify people in the general population who have traces of mutations in their blood that represent the first steps in how normal blood cells begin on a pathway of becoming increasingly abnormal and puts them at risk of progressing to AML,” co-principal investigator John Dick, PhD, FRS, senior scientist at Princess Margaret Cancer Centre, University Health Network, said in a statement.

 “We can find these traces up to 10 years before AML actually develops. This long-time window gives us the first opportunity to think about how to prevent AML.”

The researchers used data from a large European population health and lifestyle study that tracked 550,000 people over 20 years. The team used data from more than 100 participants who developed AML 6 to 10 years after joining the study, plus data from an age-matched cohort of more than 400 people who did not develop AML.

New research has identified the origins of acute myeloid leukemia, which can be detectable more than 5 years before the disease develops.

New Screening Test May Help Predict AML Risk Years Before Disease Onset

Research presented at the 2018 American Society of Clinical Oncology Annual Meeting identified predictors of long-term survival and health-related quality of life in patients with newly diagnosed multiple myeloma (MM).

used data from the registry, which is a multicenter prospective observational cohort study in the United States designed to examine diagnostic and treatment patterns, clinical outcomes, and quality of life in patients with newly diagnosed MM, in order to identify characteristics associated with overall survival of 6 years or greater versus death at less than 6 years.

As of February 2017, the median follow-up was 65.4 months. Some of the baseline characteristics associated with overall survival of 6 years or greater were: age (being 70 years old or young); ECOG Performance Status of grade 0 or 1 (being fully active or being restricted in physically strenuous activity but ambulatory); lower International Staging System stage, which is used to prognosticate the severity of MM; and lack of history of diabetes.

The researchers also found that patients who had an overall survival of 6 years or longer also had higher rates of triplet treatment, stem cell transplant, and maintenance therapy (with or without stem cell transplant), as well as higher response rates.

New research identified predictors of long-term survival and health-related quality of life in patients with newly diagnosed multiple myeloma.