Wenyi Qiu, MS

Traditionally, generic drugs have been viewed as low-cost alternatives to more costly branded products. While generic drugs often are cost-saving, the rising price of generic drugs has received considerable press in the past year.

 Instead of generic drugs getting cheaper over time, the median price change was 0% with half of all retail generic drugs becoming more expensive over a recent 12-month period.

 In this same analysis, 1 out of 11 generic drugs was found to have more than doubled in cost, with some increases exceeding 1000%; albendazole, digoxin, and doxycycline are examples of generic drugs that have skyrocketed in price despite having been available for many years.

The cause of the rising costs of generics is complex and multifactorial, and includes the transfer of the rights of a drug to a new company, corporate consolidation, shortages of raw materials, and manufacturing issues.

 In the case of digoxin, the dramatic price increase coincided with a number of manufacturers exiting the market, leaving only 2 companies manufacturing the drug.

 Experts report that 4 or 5 generic companies need to be in the market for significant price decreases to occur.

 Unfortunately, US antitrust laws protect customers only from price-fixing among competitors, not legal market monopolies1 ; there is, however, some concern that some generic manufacturing monopolies may violate US law. The Securities and Exchange Commission issued subpoenas to 2 manufacturers of generics on November 3, 2014, as part of an investigation into antitrust law violations and generic drug pricing.

While manufacturers may leave the market for a particular generic drug for many different reasons, they cannot quickly enter new generic drug markets, to fill an available “vacuum”—this is a barrier to keeping generic drug costs low. The response time for an abbreviated new drug application for generic drug approval has been reported to exceed 40 months, with the FDA having a recent backlog count of 2800 applications.

 The FDA aims to reduce the backlog by 90% and the application review times to 10 months by 2017.

 However, these aggressive goals may be difficult to achieve due to the severity of the backlog.

In early 2014, the National Community Pharmacists Association sent letters to the leaders of the US Senate Committee on Health, Education, Labor & Pensions and the US House of Representatives Committee on Energy and Commerce, requesting an oversight hearing, citing increases of 600%, 1000%, or more in pharmacy acquisition prices for essential generic drugs.

 A Congressional investigation was announced in October 2014, with the first hearing occurring in November 2014. All invited executives of generic manufacturers declined to testify

; subsequently, members of the Senate and House of Representatives announced their intent to propose legislation demanding rebates to Medicare and Medicaid if the prices of generic drugs rise faster than the rate of inflation—a policy that is already in place for branded drugs.

 Without new legislation, the costs of generic drugs are likely to continue to rise. The objectives of this analysis were to quantify the trend in high-cost generic spend and to quantify the prevalence of high-cost generic drug use in a large insured population.

An observational, descriptive analysis was conducted using de-identified pharmacy fill information from the research database of MedImpact Healthcare Systems, Inc, a pharmacy benefit manager that manages pharmacy benefits for more than 50 million lives globally. Data used for this study was limited to commercial plans (health maintenance organizations and self-funded plans) and Medicaid and Medicare Part D plans in the United States. Per member per month (PMPM) drug spend was determined for generic drugs costing $50 or more for a 30-day supply (high-cost generics [HCGs]) and generic drugs costing less than $50 per 30-day supply (other generics) for 6-month increments from July 1, 2012, through December 31, 2014. Generic drug spend included the total cost of the drug (plan-paid plus member-paid). The proportion of generic fills and generic spend that were due to HCGs were quantified for each line of business during 2014. Analyses were performed using SAS version 9.3 (Cary, North Carolina). 

HCGs comprised 13.8% of all generic fills and 54.1% of total generic spend across all lines of business in 2014. Greater proportions of HCG fills were seen in commercial lines of business (HMOs, 15.6%; self-funded plans, 13.8%) compared with the government lines of business (Medicare Part D, 10%; Medicaid, 11.8%) (Figure 1). HCGs accounted for a large proportion of generic drug costs in all plan types, ranging from 47% (Medicare Part D) to 59.2% (self-funded plans) of total generic spend.

The HCG PMPM spend across all lines of business increased from $9.17 PMPM in the second half of 2012 to $12.20 PMPM in the second half of 2014, an average increase of 16.5% annually (Figure 2). The PMPM costs for other generic drugs (less than $50 per month) remained relatively stagnant over the same time period with an average annual increase of —0.1%. The increase in HCG PMPM spend is due largely to the increased costs of HCGs, as costs increased at a faster rate than the increase in number of fills (data not shown). The proportion of HCG fills increased an average of 1.7% per year, and the proportion of total generic spend on HCGs increased an average of 7.5% per year.

Although HCGs account for a relatively small proportion of fills, the total costs are significant, accounting for more than half of total spend on generic drugs during 2014. Without aggressive management on the part of plan sponsors or pharmacy benefit managers, the current trend in HCG spend is likely to continue in the coming years. Fortunately, the opportunity exists to mitigate the high spend, as many HCGs have reasonable cost-saving alternatives. (Examples of HCGs and potentially appropriate alternatives are listed in the 

) HCG drug costs may be many times greater than for the lower-cost generic alternative. For example, using the national average drug acquisition cost for Medicaid beneficiaries, the conversion of combination amlodipine/atorvastatin tablet to separate amlodipine and atorvastatin tablets could save up to $156 per month.

 Decision makers will need to consider if various HCGs are worth the additional costs when lower-cost alternatives are available.

addressed the increasingly common strategy of placing “higher-cost generic drugs” on a higher co-pay tier.

 The authors expressed concern that many of these “nonpreferred” generics include first-line treatment in a variety of diseases, making these conditions effectively “nonpreferred.” Also, the placement of highly effective and widely used generic drugs on a nonpreferred tier based solely on cost may lead to decreased adherence, poor outcomes, and increased costs elsewhere in the system when there are no therapeutically equivalent “preferred” alternatives from which to choose. It is reasonable that there should be nonpreferred generic drugs only when there are therapeutically equivalent medicines on formulary.

In a sample of insurers examined, not all plans with 2 generic tiers had preferred low-cost alternatives in all of the conditions examined.13 Greater savings can be achieved through the identification of lower-cost alternatives; the potential plan savings from patients switching to lower-cost alternatives often far exceeds the plan savings that can be achieved solely by cost-shifting in raising the co-pay. In addition to co-pay incentives, educational outreach to providers and patients would enhance plan savings because changes in therapy are more likely if patients and providers are informed regarding which generic drugs are lower in cost in addition to co-pay incentives.

The various factors contributing to rising generic drug prices are unlikely to resolve in the coming years. Plans can expect generic plan spend and drug price inflation to continue, although it is difficult to predict which generic drugs will become expensive and when. Strategies to convert patients from HCGs to lower-cost, clinically appropriate alternatives are likely to be more cost-saving than increasing patient cost share alone.

Articles

The prevalence and proportion of spend on high-cost generic drugs is examined.

Trends in High-Cost Generic Drug Utilization and Spend

It is estimated that in the United States there will be 1.7 million new cases of cancer in 2014. Cancer remains the second-leading cause of death in the United States, just behind heart disease.

 Although in recent years the death rate for all cancers combined has decreased and the overall incidence of cancer has stabilized in the United States,

 because cancer incidence is highest in the elderly, the aging of the population and prolonged survival will likely increase the percentage of Americans being treated for cancer. The US Census Bureau projects that the population 65 years and older will grow from 48 million in 2015, to 65 million in 2025.

 A 27% increase in national cancer care costs between 2010 and 2020 has been predicted because of the aging and growing of the US population alone.

Oncology drug spend is increasing within the pharmacy benefit as more self-administered oral oncology drugs enter the market.

 According to 2013 pharmacy benefit manager (PBM) reports, cancer was the third-most costly condition to treat within the specialty drug categories.

 The average cost per month of a branded oncology drug in the United States increased from $5000 to $10,000 within the past 10 years.

 Newer drugs tend to be priced higher than previous therapies despite the lack of correlation between the price and overall survival or quality-adjusted life-years.

 Many existing oncology drugs have had dramatic increases in price that far exceed the rate of inflation.

 Oncology has the greatest number of drugs in development, with 4 times as many drugs in the pipeline compared with the next therapeutic class.

 Treatment costs are likely to continue rising as more drugs come to market.

Our purpose is to describe recent trends in oncology drug utilization, ingredient costs, and per member per month (PMPM) costs within the pharmacy benefit and to explore potential trend drivers including drug approvals.

An observational descriptive analysis was conducted using deidentified pharmacy fill information from the research database of MedImpact Healthcare Systems, Inc. MedImpact is a PBM that manages pharmacy benefits for more than 47 million lives globally. Data used for this study were limited to commercial, Medicaid, and Medicare Part D plans in the United States. The measurement period for this analysis began on January 1, 2011, and ended on June 30, 2014. Utilizing member count, average ingredient cost per claim and PMPM costs of all available FDA-approved antineoplastic agents (excluding oral methotrexate) were calculated on a quarterly and annual basis for commercial, Medicaid, and Medicare Part D lines of business during the measurement period.

The FDA-approved indications, approval type (original approvals for New Molecular Entities [NMEs] or additional approved indications through Supplemental New Drug Applications [sNDAs] or Supplemental Biologics License Applications [sBLAs]), with approval dates from 2009 through July 2014, were compiled using approval reports available on the FDA website and the CenterWatch website.

 The route of administration and mechanism of action, including whether the oncology drug is indicated for use in patients with specific genotypes of cancer (eg, anaplastic lymphoma kinase, positive metastatic nonsmall cell lung cancer), were identified using the Clinical Pharmacology database.

Orphan drug designation was determined by searching the Orphan Drug Product designation database on the FDA website.

The average ingredient cost per claim for oncology drugs in the first half of 2014 was $698 for commercial, $547 for Medicaid, and $550 for Medicare Part D lines of business (

). The annual rate of increase in average ingredient cost per claim for oncology drugs from 2009 through the first half of 2014 was 22.7% for commercial, 25.2% for Medicaid, and 22% for Part D-utilizing members. The annual rate of increase in utilizing members was 8.1% for commercial, 3.4% for Medicaid, and 3.5% for Part D (

). Medicare Part D plans had 4 to 9 times more oncology drug-utilizing members in 2014 (39.4 per 1000) compared with commercial (10.2 per 1000) and Medicaid (4.3 per 1000) plans, respectively. The average PMPM spending on oncology drugs was $3.64 for commercial, $1.38 for Medicaid, and $12.26 for Medicare Part D plans during the first half of 2014 (

). The PMPM annual rate of increase was 27.1% for commercial, 35.6% for Medicaid, and 26.5% for Medicare Part D.

A total of 41 NME drugs were approved for the treatment of cancer from 2009 through July 2014. The proportion of NMEs that are orally administered increased from 40% in 2009 to 75% in 2013 (

). The proportion of NMEs with indications targeting specific genotypes of cancer increased from 0% in 2009 and 2010 to 28.6% in 2011, and up to 50% in 2013 (

). NME approvals (n = 12) and all new indication approvals (NME and sNDA/sBLA) (n = 18) were greatest in 2012 (

). During 2009 through July 2014, the FDA approved drugs for 73 new cancer indications. The most prevalent indications were for chronic lymphocytic leukemia and nonsmall cell lung cancer, with 7 approvals each, followed by breast cancer, melanoma, and prostate cancer with 5 approvals each (Table). The proportion of indications that were granted orphan drug designation increased from 66.7% in 2009 to 83.3% in 2013 (

Medicare Part D plans had a larger prevalence of oncology drug-utilizing members compared with commercial and Medicaid plans, consistent with the higher incidence of cancer in older age. Medicare Part D and Medicaid plans experienced similar annual rates of increase (3.5% and 3.4%, respectively) in oncology drug-utilizing members. Commercial plans had the greatest annual rate of increase in utilizing members (8.1%). This may be because of the increased proportion of cancer survivors in the continuing phase of care. Cancer is becoming more of a chronic disease, with newer oncology drugs indicated for indefinite use in responding patients. Although cancer incidence has stabilized in the United States, increased survival and arrival of novel treatments are likely contributors to the expanding population being treated with antineoplastic drugs.

Observed annual rates of increase in oncology drug average cost per claim (22% to 25%) exceeded national trends for the annual rate of increase in average retail price for branded drugs (8.5%) during a similar time period.

 Oncology drug prices appear to be less stable than those for other branded drug products. The increases in average ingredient cost may be due to more costly newer agents or to price increases for all agents. The proportion of oncology drugs for rare diseases with orphan drug designations and for specific genotypes demonstrated a general upward trend. This may be a major contributor to increased oncology drug spending because drugs indicated for smaller populations are likely to be priced higher. Government programs are generally able to receive the best pricing for drugs, and so the average ingredient cost was greater for commercial members compared with Medicaid and Medicare Part D beneficiaries. However, Part D plans are required by law to include all drugs “where restricted access would have major or life threatening clinical consequences...such as drugs used in the treatment of cancer.”

 There is little incentive for pharmaceutical companies to negotiate oncology drug prices or price competitively when coverage is mandated by law.

It is noteworthy that many states have laws that limit the ability of private payers to manage cancer drug utilization;

state laws that have mandated coverage requirements for cancer drugs affect 74% of the nation’s population.

Oncology drug PMPM prescription drug spending has increased dramatically over the past 3.5 years as measured in a large national PBM population. The increase in PMPM spending is largely influenced by the increase in drug cost, with more modest increases in utilizing members. Although Medicare Part D had the most PMPM spending over the measurement period, the greatest rate of increase was in Medicaid plans, followed by commercial plans, then by Part D plans. We observed more approvals with orphan drug designation, oral route of administration, and genotype-targeted therapies, which are all likely contributors to increased oncology prescription drug spending. If these trends continue, prescription drug spending for oncology drugs may outpace treatments for other diseases.

Annual rates of increase in oncology drug utilization, drug price, and plan spending are quantified and potential contributors are explored.

Longitudinal Trends of Utilization, Cost, and Prevalence in Oncology

Since the discovery of the hepatitis C virus (HCV) in 1989, the chronically infected population has experienced dynamic change. The prevalence of chronic HCV infection in the United States has decreased over the past decades, with the most recent estimate at approximately 2.7 million people (or 1%) of those 6 years and older.

 The decline corresponds with the increase in HCV-associated deaths and decreased transmission rather than from an increase in treatment success.

Increasing access to more effective and affordable treatments is a major public health concern.

Chronic HCV infection remains largely undertreated, with only 13% to 18% of infected individuals having received treatment.

 The largest barrier to treatment is that many infections remain undiagnosed, with fewer than half of all HCV-infected individuals being aware of their infection.

 Other barriers to treatment include contraindications or perceived contraindications by prescribers, lack of access to prescribers with HCV expertise, and patient barriers (eg, the asymptomatic nature of the infection, fear of medication side effects, and concerns regarding treatment duration, cost, and effectiveness)

 Patients and prescribers have postponed treatment in hopes of more effective and more tolerable treatments on the horizon.

After developing chronic HCV infection, 60% to 70% will progress to chronic liver disease; 5% to 20% will develop cirrhosis; and 1% to 5% will die from cirrhosis or liver cancer.

 However, these sequelae take decades to develop, and for most patients, there is no urgency for treatment. Treatment is recommended for individuals with existing liver disease or fi brosis, but may be delayed for those with less severe disease.

As the majority of patients are believed to have acquired their infection between the 1960s and the 1980s, the proportion of newly diagnosed patients with mature infection requiring immediate treatment is steadily on the rise.

 Chronic infection is more often found among individuals over age 50 years. Approximately 81% of individuals with HCV infection were born between 1945 and 1965.

 In 2012, the Centers for Disease Control and Prevention issued guidance that all persons born in this time frame should be screened for HCV at least once, regardless of risk factors.

 With increased screening, more individuals are likely to be diagnosed and receive treatment in coming years.

The goal of therapy is to eradicate HCV infection, and with it to prevent liver cirrhosis, liver failure, hepatocellular carcinoma (HCC), and death.

 The eradication of HCV is determined by a highly sensitive assay in which circulating HCV RNA is undetectable at 12 or 24 weeks after completion of treatment—known as sustained virologic response (SVR). SVR at 24 weeks has been shown to provide a durable response and is associated with improvement in liver fibrosis, reduced risk of liver-related morbidity and mortality (including liver failure, liver transplantation, and HCC), and reduced risk of all-cause mortality, even in advanced cases.

 In 2013, undetectable serum HCV RNA at 12 weeks after the end of treatment was found to be concordant with testing after 24 weeks, and has become the new standard of care and end point used in clinical trials.

Genotype 1 is the most common HCV genotype in the United States, comprising approximately 70% of all cases. It is also the most difficult to treat, requiring prolonged therapy. Beginning in 2001, pegylated interferon plus ribavirin was the standard-of-care treatment for all genotypes. A 48-week regimen with pegylated interferon and ribavirin for genotypes 1, 4, 5, and 6 typically resulted in SVR rates of 40% to 50% (

). In clinical trials, treatment-naïve patients with HCV genotypes 2 and 3 treated with pegylated interferon plus ribavirin for 24 weeks often obtained SVR rates of 70% to 80%.

The SVR rates achieved in clinical trials may not always be realized due to suboptimal patient adherence in the general population.

 Severe side effects often negatively impact patient adherence to therapy.

Pegylated interferon products have a black box warning of fatal or life-threatening neuropsychiatric, autoimmune, ischemic, and infectious disorders. The side effects of pegylated interferon that often cause the most frequent complaints from patients are the flu-like symptoms, which must be tolerated for up to 48 weeks. Ribavirin also has serious side effects, including anemia, which can worsen heart disease, and teratogenicity.

In 2011, 2 direct-acting antiviral (DAA) non-structural (NS) 3/4A protease inhibitors, boceprevir and telaprevir, were approved to treat genotype-1 HCV. SVR was achieved for an additional 25% to 31% of treatment-naïve patients treated with boceprevir or telaprevir plus pegylated interferon and ribavirin compared with standard dual therapy.

 Boceprevir and telaprevir require complex treatment response—guided regimens, carry signifi - cant pill burdens, and have greater incidence of severe side effects such as cytopenias and skin reactions.

 Boceprevir and telaprevir are both substrates and inhibitors of P-glycoprotein and cytochrome P450 3A4, which can cause significant drug interactions. In one cohort study, potential drug interactions that required dose adjustments or medication changes were found in half the population initiating boceprevir or telaprevir.

In late 2013, 2 additional oral DAAs were approved. Simeprevir, a third NS3/4A protease inhibitor, was approved for use in conjunction with pegylated interferon and ribavirin to treat HCV genotype 1. Advantages of simeprevir over first-generation NS3/4A protease inhibitors include once-daily dosing, slightly improved SVR rates, and an improved side effect profile. Overall, 80% of patients achieved SVR; however, among patients with genotype 1a, 58% of patients achieved SVR with the NS3 Q80K polymorphism compared with 84% of patients without the polymorphism.

 It is recommended, but not required, that patients be screened for the NS3 Q80K polymorphism prior to initiating regimens including simeprevir.

The most recent DAA addition is sofosbuvir, the first NS5B polymerase inhibitor approved to treat chronic HCV and the first approved medication for use in an all-oral HCV treatment regimen. Sofosbuvir provides the additional advantages of once-daily dosing, improved SVR rates, efficacy for all genotypes, no cytochrome P450 3A4 drug interactions, and shorter therapy duration (12 weeks total) for certain patients. Among genotype-1 treatmentnaïve patients, SVR was achieved for 89% with sofosbuvir, pegylated interferon and ribavirin for 12 weeks.

 Limited results are available for sofosbuvir use in patients with genotype 1 who had failed prior therapy with pegylated interferon, and ribavirin; however, the US Food and Drug Administration (FDA) allowed approval of sofosbuvir in this population based on extrapolated results from other difficult-to-treat patient populations. The American Association for the Study of Liver Diseases (AASLD) and the Infectious Diseases Society of America (IDSA) have released treatment guidelines that recommend sofosbuvir regimens, including the unapproved sofosbuvir and simeprevir combination regimen, as standard-of-care treatments (

Chronic HCV infection has been costly to treat, with average wholesale prices (AWPs) of pegylated interferon products ranging from $20,309 to $44,424 per treatment as of February 2014. The treatment of genotype-1 HCV significantly increased with the addition of NS3/4A protease inhibitors. Current AWPs for NS3/4A protease inhibitors range from $43,808 to $79,632 per treatment. Sofosbuvir has been launched with AWP of $1200 per day. Based on AWP pricing, 12 to 24 weeks of sofosbuvir costs $100,800 to $201,600. The high cost of treatment has raised concerns among patient advocacy groups and payers.

 As the treatment costs vary widely across the new standardof- care regimens, this analysis quantifies the proportion of patients initiating sofosbuvir and simeprevir, including interferon-free regimens. An understanding of prescribing patterns with these new drugs will help payers manage appropriate utilization and project drug spend.

A retrospective, cross-sectional analysis was performed using de-identified data from a sample of participating clients in the research database of MedImpact Healthcare Systems, Inc, a national pharmacy benefi ts manager (PBM). Patients initiating sofosbuvir or simeprevir from November 22, 2013 (the FDA approval date for simeprevir; the FDA approval date for sofosbuvir was December 6, 2013), through February 28, 2014, were identified. The first fill date for sofosbuvir was considered the index date. If no fill for sofosbuvir was identified, the first fill date of simeprevir was defi ned as the index date. Each identifi ed patient’s HCV treatment regimen was determined by looking for fill dates of other HCVindicated medications during the concomitant therapy period, which extended from 30 days prior to the index date through 30 days after the index date. The number of patients taking each of the following FDA-approved or ASLD/IDSA-recommended regimens was identifi ed: (1) sofosbuvir, pegylated interferon and ribavirin; (2) sofosbuvir and ribavirin (no interferon products, no protease inhibitors); (3) simeprevir, pegylated interferon, and ribavirin; (4) simeprevir and sofosbuvir with ribavirin (no interferon products); (5) simeprevir and sofosbuvir (no interferon or ribavirin products). Treatment costs were quantified using February 2014 AWP for branded products and maximum acquisition cost (MAC) for generic products (ie, ribavirin products).

In the first few months of market availability of simeprevir and sofosbuvir, nearly 8 times as many patients have initiated sofosbuvir (n = 435) as initiated simeprevir (n = 57) (

). These groups are not mutually exclusive. In fact, 95% of simeprevir initiators are taking unapproved, ASLD/IDSA-recommended, interferon-free, sofosbuvir-based regimens. Only 5% of simeprevir initiators began the FDA-approved regimen with pegylated interferon and ribavirin.

Of sofosbuvir initiators, only 41% are taking concomitant pegylated interferon and ribavirin and more than half (57%) are taking interferon-free regimens indicated for genotypes 2 and 3 and interferon-ineligible genotype 1. Two percent of sofosbuvir users did not have claims for recommended concomitant therapy during the 30 days prior to and 30 days after sofosbuvir initiation.

The AWP cost per treatment for 48 weeks of pegylated interferon and ribavirin (standard of care for genotype-1 patients from 2001-2011) is $42,411 to $46,218 (Figure 4). The HCV protease inhibitor—based regimens (boceprevir, telaprevir, or simeprevir with pegylated interferon and ribavirin) are signifi cantly more expensive at AWP costs of $70,768 to $126,432. The AWP cost of a sofosbuvir- based regimen for genotype-1 treatment-naïve or relapser, interferon-eligible patients is between $122,006 and $123,909. The cost of interferon-free sofosbuvir regimens, recommended for interferon-ineligible genotype-1 patients, ranges from $180,432 (sofosbuvir, simeprevir for 12 weeks) to $202,497 (sofosbuvir, ribavirin for 24 weeks). The latter AWP treatment cost is 66% more expensive than the 12-week interferon-based sofosbuvir regimen and approximately twice as much as the protease inhibitor based–regimens that were standard of care between 2011 and 2013.

Our pharmacy claims—based analysis found that 41.1% (n = 180) of patients initiating sofosbuvir or simeprevir were taking concomitant pegylated interferon and ribavirin. A greater proportion of patients (57.1%, n = 250) initiated an interferon-free sofosbuvir regimen. Most health plans covered by our PBM elected to use prior authorization guidelines to determine appropriate use for medication coverage that is consistent with approved indications and evidence-based standard of care. As the proportion of genotype 1 among the chronic HCV population in the United States is at least 70%, it is expected that a similar proportion of sofosbuvir initiators would be on the FDA-approved regimen for genotype 1 (sofosbuvir, pegylated interferon and ribavirin). It may be that a greater proportion of genotype 2 or 3 patients have initiated therapy in this early time period or that a large proportion of genotype 1 patients initiating therapy have been deemed interferon-ineligible. The cost implications of the latter scenario are significant, as treating genotype 1 patients with an interferon-free regimen costs between $58,426 and $80,491 more per patient, and with decreased efficacy. An SVR of 72% was realized in a total of 211 treatment-naïve genotype 1 patients using sofosbuvir and ribavirin in various clinical trials.

 The AASLD/IDSA guidelines recommend that the all-oral combination of sofosbuvir with ribavirin for 24 weeks should be considered only for genotype-1 patients who require immediate treatment, because regimens with improved safety and efficacy will likely be available by 2015.

The higher costs of more efficacious treatment may be justified as the costs of treatment failure are significant. One analysis found a 10-fold difference in the costs between managing patients who achieved SVR versus those who did not achieve SVR over a 5-year period, with a retreatment rate of 19% among SVR nonachievers.

The outstanding question is whether these new standard-of-care therapies are cost-effective. A Markov model analysis, published months before sofosbuvir was approved, determined that $112,653 was the maximum drug cost for an all-oral regimen achieving 90% SVR to remain cost-effective using a $100,000 per quality adjusted life-year willingness-to-pay threshold.

 For most patients, the current all-oral sofosbuvir-based regimens do not meet the 90% SVR standard of efficacy and are much more expensive.

The standard of care for the treatment of chronic HCV infection continues to evolve. Several novel drugs are being studied in which preliminary data demonstrate close to 100% SVR (Figure 1).

 The future standard of care will be oral regimens that are more effective and presumably more tolerable. Present interferon-free regimens have less evidence of efficacy and a substantial cost (between $180,881 and $202,497 per treatment) for the majority of patients who will receive these treatments. It is yet unknown if the current trend of increasing costs for chronic HCV treatment will continue, or at what point it will no longer be sustainable.

This article is an early utilization review of newer, more effective, and more costly regimens for the treatment of hepatitis C.

Recent Trends in the Treatment of Chronic Hepatitis C

Cardiovascular disease is the leading cause of death in the United States.

 By 2030, the prevalence of cardiovascular diseases, including hypertension, is projected to reach more than 40% of US adults and cost the United States $1.1 trillion annually (unadjusted 2008 dollars).

 Hypertension, dyslipidemia, and diabetes mellitus are key risk factors for cardiovascular disease and cardiovascular events. Several observational studies have demonstrated that adherence to medications indicated for the treatment of hypertension, diabetes mellitus, or dyslipidemia is associated with better cardiovascular outcomes, decreased cardiovascularrelated and all-cause hospitalizations and emergency department visits, and lower total healthcare costs.

 Although the validity of these results has been called into question by demonstration of the “healthy user bias,”

 it stands to reason that for a drug to be effective, it needs to be taken regularly. Furthermore, adherence to oral antidiabetic drugs (OADs), antihypertensives, and HMGCoA reductase inhibitors (statins) has been shown to be associated with the cardiovascular intermediate outcomes of lower glycosylated hemoglobin, blood pressure, and low-density lipoprotein cholesterol levels.

Medication adherence is defi ned as “the extent to which a patient acts in accordance with the prescribed interval and dose of a dosing regimen.”

Payers with large claims databases measure patient adherence with “medication possession” methodologies that use prescription fill dates and days’ supply. These methodologies are based on the number of days a patient has possession of medication rather than if the patient has actually taken the medication. The most commonly used measure in the literature is the Medication Possession Ratio (MPR).

 There are many variations of MPR used in the literature; however, MPR is generally calculated as the sum of the days’ supply of medication available in a given period of time divided by the sum of the number of days in the period or the time between the first and last fill of medication.

 The latter denominator may infl ate adherence measurements as it does not consider potential discontinuation of chronic therapy.

 Also, when shorter observation periods are used, the likelihood of adherence is increased.

The Pharmacy Quality Alliance (PQA) developed and tested a medication possession adherence measure known as the Proportion of Days Covered (PDC) in several chronic medication classes and concluded that it is to be preferred over MPR methodologies.

 PDC is calculated as the number of days within the calendar year with medication supply divided by the number of days the patient is eligible for benefits. If fills overlap, the start date of the next fill is adjusted to be the day after the previous fill ended. Also, if patients have supply for more than 1 medication within the measured class on the given day, the day is only counted once as being “covered.” Thus, the PDC provides a more conservative estimate of adherence when there may be switching and concomitant therapy.

 Unfortunately, there are variations in PDC methodology in the literature and PDC sometimes is used as a misnomer for calculations consistent with MPR methodology.

 The definition of 80% PDC or MPR as a threshold for adherence is common in the literature.

 The PQA PDC methodology includes reporting the number of patients reaching 0.80 or greater PDC. While somewhat arbitrary, the 80% threshold for OAD, direct renin inhibitors (DRIs), and statin adherence has been shown to be predictive of clinical outcomes.

Since the PQA endorsed a specific PDC methodology, there has been movement toward using it as the “gold standard.” The National Quality Forum (NQF) endorsed the PDC measure for 5 medication types in 2009.

 The Centers for Medicare & Medicaid Services (CMS) adopted this methodology in 2010 for measurement of adherence to OADs, DRIs, and statins as part of the Five-Star Ratings Quality Rating System.

The National Committee for Quality Assurance (NCQA) has adopted PDC for adherence measures in the Healthcare Effectiveness Data and Information Set (HEDIS),

 and URAC—a healthcare accreditation agency&mdash;has adopted the methodology as part of the mandatory performancemeasures for pharmacy benefit management (PBM) and health plan accreditations.

Also, PDC will be included in the battery of clinical quality measures for Qualified Health Plans (QHPs) accreditation necessary for participation on the Health Insurance Exchanges initiated by the Affordable Care Act.

The inconsistency and variations in the use of MPR and PDC in the literature encumbers the comparison of adherence measurements in different medication classes and in different patient populations when not conducted in the same study. Several studies have shown differences in the adherence to various chronic therapies within the same population.

 Insurance type has been shown to be a significant predictor of adherence,

 likely because of the differences in demographic and clinical characteristics of the patients eligible for each type of benefit. It is of interest to compare adherence rates in these disparate populations. To the authors’ knowledge, such a comparative analysis does not exist. The objective of this analysis is to compare adherence rates for 3 key chronic medication categories in populations enrolled in different insurance types using the PQA-endorsed PDC methodology and to understand whether adherence may be trending over time.

A retrospective, cross-sectional analysis was performed using de-identified data from a sample of participating clients of MedImpact Healthcare Systems, Inc, a national pharmacy benefits manager, during 2012 and 2013. Four distinct cohorts were defined by type of insurance: commercial, Medicaid (a mix of Medicaid benefi ciaries and enrollees in programs for the indigent and other statefunded public programs), Medicare Part D beneficiaries (a mix of Medicare Advantage Prescription Drug [MA-PD] plans and Prescription Drug Plans [PDPs]), and selfinsured commercial health plans.

Within each insurance type, adherence was calculated as the Proportion of Days Covered (PDC) for each target medication class using specifications from the CMS Medicare 2014 Part C & D Star Rating Technical Notes (released September 27, 2013) and Pharmacy Quality Alliance Technical Specifications.

 Specifically, for patients 18 years and older with at least 2 claims for the target medication class, PDC was measured from first claim in the measurement period (index date) to end of the measurement period or member disenrollment. Days of medication coverage was calculated using fill dates and days of supply elements of prescription claims within each patient’s measurement period.

 Adherence was calculated for each cohort by using patients’ adherence rates while adjusting for length of member enrollment, or member years. Member years were calculated as number of months enrolled divided by months eligible in each measurement period. Target medication classes included OADs, DRIs, and statins—the 3 classes used in the CMS Part D Patient Safety measures. Patients utilizing insulin during the measurement period were excluded from the OAD measurement.

PDC and percent of patients meeting the definition of adherence of PDC greater than or equal to 0.80 were measured over the 2012 and 2013 calendar years as specified by PQA and CMS. We calculated these metrics for rolling 1-year periods at the conclusion of each quarter to observe possible temporal trends or seasonality. Analyses were performed using SAS (Cary, North Carolina) version 9.3.

Patients enrolled in Medicare Part D demonstrated greater adherence compared with the other insurance types in all 3 measured medication classes (

). The insurance types listed in order of decreasing observed adherence were Medicare Part D, commercial, self-insured health plans, and lastly, Medicaid. This was consistent across all medication classes. The percentage of Medicare Part D patients meeting the threshold of PDC greater than or equal to 0.80 ranged from 81.2% to 82.3% for OADs; 80.9% to 82.4% for DRIs; and 77.1% to 79.1% for statins. Of patients enrolled in commercial plans, 77.5% to 78.7% of patients were adherent to DRIs; 74.2% to 75.1% of patients were adherent to OADs; and 72.1% to 73.8% of patients were adherent to statins. The proportions of patients in self-insured plans who were adherent to therapy were 70.5% to 72.5% for DRIs; 67.0% to 68.2% for OADs; and 64.4% to 67.1% for statins. The Medicaid cohorts consistently had the smallest proportion of adherent patients compared with other insurance types. The proportion of adherent Medicaid patients ranged from 66.3% to 66.7% for OADs; 60.6% to 62.1% for DRIs; and 57.2% to 58.6% for statins. The proportion of adherent patients in the commercial and Medicare Part D populations increased from calendar year 2012 to calendar year 2013 for all 3 categories (

). The proportion of adherent patients decreased between the 2012 and 2013 calendar years for Medicaid benefi ciaries. The self-insured commercial population exhibited an increase in the proportion of patients who were adherent to OADs, a decrease in the proportion of patients who were adherent to DRIs, and no change in the proportion of patients who were adherent to statins between the 2012 and 2013 calendar years.

This analysis observed the greatest adherence in a Medicare Part D population, followed by commercial, self-insured health plans, and then Medicaid populations. Although copays are typically lowest for Medicaid patients, the lower prevalence of adherent patients is not unexpected, given the characteristics of the eligible beneficiaries. The Medicaid population has a greater prevalence  of chronic diseases, mental disorders, and higher utilization of acute care services compared with commercial populations.

 In addition to greater disease burden, Medicaid patients are recipients of lower quality of care, similar to the uninsured.

Higher rates observed among Part D beneficiaries are likely impacted by the Five-Star Quality Rating System that rewards health plans for increases in quality performance. The observed high adherence in Medicare Part D is also consistent with our  understanding that adherenceimproves with age. Increasing age is a signifi cant  predictor of the increased likelihood of being adherent to statins, antihypertensives, and antidiabetics.

 However, adherence to these medication classes has been shown to increase with age only up to a certain point, with the “younger old” being more adherent.

 Older age is associated with more comprehension errors, inconsistent preferences, and decreases in working memory that are associated with decreased adherence.

 Therefore, a younger Medicare Part D population would be more likely to have a higher proportion of adherent patients compared with an older one. Our observations may not be representative of the nation’s Medicare Part D population, as MedImpact’s Medicare population contains 21% low-income subsidized eligible patients compared with 34% of Part D benefi ciaries nationwide.

We observed the least adherence and the smallest proportion of adherent patients with the statin medication class (

, Figure 1). This is consistent with other observational studies examining diabetes, hypertension, nd dyslipidemia medication adherence.

 A limitation of the PDC methodology is the possibility of inflation when combination therapy is used. For example, a patient prescribed dual OAD therapy who is adherent to 1 OAD (eg, glipizide) and not adherent to the other (eg, metformin) will be classifi ed as adherent. Since PDC methodology requires supply of only 1 medication on each given day, multi-drug regimens, as is common with OAD, provide more opportunities to be adherent compared with monotherapy, as is the case with statins. The decreased prevalence of adherence to statins compared with DRIs may refl ect a greater prevalence of intolerance or negative patient beliefs, such as concerns regarding possible side effects. Patient beliefs of lower perceived risk of myocardial infarction, expected short treatment duration, and concern about potential harm from statins have been shown to be negative predictors of statin adherence.

The generalizability of these observations to other populations may be limited due to the complex nature of adherence. Adherence is impacted by many factors not previously mentioned or described here, such as gender,

However, this study selected data from a large geographically diverse population.

Using the CMS-adopted PDC adherence methodology, adherence rates differ by insurance type. Medicare Part D and commercial plans have a greater proportion of patients who are adherent to the major chronic therapies for diabetes, hypertension, and dyslipidemia compared with Medicaid and self-insured health plans. OAD and DRI adherence measurements were greater than adherence to statins for all insurance types. Measurements were stable over time, with commercial and Medicare Part D populations showing improvements from 2012 to 2013. The measurements indicate that many patients are nonadherent to these medication categories. Health plan sponsors should start or continue to increase promotion of intervention efforts aimed at improving medication adherence and health outcomes. 

Adherence trends were examined for commercial, Medicaid, Medicare Part D, and self-insured health plans for oral antidiabetic medications, statins, and direct renin inhibitors.