Consequences of Exclusivity in the Independent Specialty Pharmacy Market


Independent pharmacies must stay on top of developing trends across the specialty pharmacy landscape.

As the landscape for biologic drugs and other related therapies expands with new drug approvals and applications, ever apparent is the impact of large, national specialty pharmacies on the specialty pharmacy market. These pharmacies are often advantageously labeled with exclusivity to fill specialty medications by payers and manufactures.

Although these pharmacies are appropriately credentialed to provide these services, this tendency to narrow a patient’s options by way of exclusivity can cause an unfortunate bottleneck in service, typically resulting in a delay of care. In the shadow of these giants are regionalized independent pharmacies who fight an uphill battle to provide superior accessibility and service to patients.

The following dives into issues smaller pharmacies must endure to stay afloat, and the unfortunate consequences that patients have no choice but to accept.

1. National pharmacies set unrealistic standards for independent specialty pharmacies

It goes without saying, companies such as CVS Health, Accredo, and Walgreens are well endowed with resources. These companies alone accounted for 57% of the specialty pharmacy market share—a whopping $65.7 billion—in 2016.

An additional 24% of the market was consumed by 12 more pharmacies, leaving the remaining 19% of the market to thousands of retail, long-term care, and specialty pharmacies. With that kind of power and profitability, accrediting, pharmacy benefit manager (PBM) contracting, staffing, etc, can be accomplished with ease.1

However, the intent is not to complain about missing out on a larger piece of the monetary pie. With money comes accessibility. Resulting from this ease of accessibility are high standards developed in conjunction with accrediting bodies and PBM contracts, which are applied downstream during application processes to smaller independent pharmacies.

While it may be possible to achieve pharmacy accreditation with URAC or the Accreditation Committee Commission for Health Care, the standards that dictate these accreditations are often augmented within the applications for more robust specialty PBM contracts. Consequently, independent pharmacies are subject to strict guidelines that often result in an inability to gain approval for these contracts, despite the ability to provide such services on a smaller scale.

There are several reasons these guidelines are strict, such as reducing wasteful spending, ensuring medication compliance with proper disease state and drug education, and ensuring that payer and manufacturer reporting needs are met. The resultant cycle is the independent pharmacy attempting to acquire insurance contracts, contract application denial, and subsequent prescriptions transferred more frequently to the big players due to pharmacy exclusion.

Thus, the perception is that smaller specialty pharmacies cannot handle the fulfillment of these prescriptions and yet, paradoxically, once transferred it may take several weeks for the patient to receive the medication.

2. Lag time in advancing care coordination means lag time in patient care

To build a strong, regionalized (or national), and trustworthy specialty pharmacy, the pharmacy team involved must be willing and able to take on the challenge of care coordination. All elements of communication among the pharmacy, provider, insurer, and patient must be well-defined, efficient, and trackable for optimal coordination.

Patients should be well informed and not left wondering about the status of their prescription. Executing these factors show providers that the pharmacy can carefully assess a patient’s needs and prove the patient is in good hands once out of the office.

Certainly, big specialty pharmacies have the capability to implement these qualities, yet consistently growing prescription volume causes difficulty maintaining a dependable and efficient level of service. Anecdotes abound from patients who encounter a delay in prescription processing and prior authorization approval.

The delay starts at the level of the preferred pharmacy processing incoming prescription orders. Certain pharmacies will place transferred prescriptions into a queue, have another member review it, then contact the doctor’s office to confirm.

Other pharmacies will not accept transfers for new prescriptions as laws in which state the pharmacy resides do not allow for prescriptions that have been placed on hold to be transferred in. Thus, information at the time of phone contact is confirmed and the pharmacy then reaches out to the provider to receive a new prescription.

These extra steps waste much needed time and energy on the smaller pharmacy’s behalf, leading to serial hemorrhages in capital. On the other side of these interactions, the patient waits for a medication that they are in need of.

3. Small specialty pharmacies must account for excess spending without compensatory prescription volume

Although complexities found within the prescription intake process of big specialty pharmacies add a necessary level of quality assurance to a high volume of prescription intake, these steps are wasteful for the transferring pharmacy.

Prior to determining a prescription must be transferred, these steps are generally followed:

· intake of the prescription and patient information

· patient contact to confirm demographic and benefits information

· data entry and billing of prescription

· provider contact for required clinical data

· initiation of prior authorization process

· follow-up on prior authorizations through communication with the provider’s office

Once the pharmacy is notified of prescription approval, in general, the submission of the claim yields notice that the prescription must be filled through a specialty pharmacy. The notion of ensuring the medication is paid for by insurance is altruistic at a patient care level, as the patient is certain they are soon to receive the medication.

Pharmacies should be glad to take care of the patient and assist them in tracking the progress of the prior authorization in coordination with the providers office. However, time spent by pharmacy technicians, call center representatives, pharmacists, pharmacy liaisons, and other associated staff adds up.

The time it takes for the pharmacy team to accomplish these objectives only to determine the prescription must be transferred leads to a net loss in profit on that prescription. This concept is especially true in pharmacies that tend to provide high-touch, “white glove” services.

Thus, it is difficult for a pharmacy attempting to navigate the path of expanded access to stay afloat, as the time spent on mediating the prescription’s journey, although time well spent, yields benefit to a different pharmacy.

These are just a few of the issues that are encountered in the independent specialty pharmacy space. At this rate, the existing (and minimal) community access for specialty patients to local pharmacies that provide specialty services is likely to decrease, leading to care by way of mail order services with little exception.

This removes one of the best qualities brick and mortar pharmacies and pharmacists can provide, an informative face-to-face interaction. Independent pharmacies must stay on top of accreditation trends and relevant changes in pharmacy law to remain at the forefront of this unique type of patient care.


1. Fein, JA. 2017 February 22. The Top 15 Specialty Pharmacies of 2016. Retrieved from:

Sean Swisher, PharmD, MTM-C, is pharmacy manager at Curexa Pharmacy.

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