Oncology Formularies Have Arrived

Pharmacy Practice in Focus: OncologyApril 2022
Volume 4
Issue 2

Oncology and specialty treatments advance alongside care.

As prescription benefit managers (PBMs) began to have an increased influence over the drug selection process in the mid to late 1980s, the practice of pharmacy underwent significant change. Although formularies are the norm for community pharmacy and have been in place even longer in hospital pharmacy, specialty pharmacy has been somewhat insulated from their impact as few, if any, alternative therapies were available for affected disease states.

As the oncology and specialty space matures, so do treatment options. Newer generations of treatment alternatives for cancer have opened the door for payers to leverage one drug over another. As a result, treatment options and higher costs have changed the dynamics.

Product Exclusion

Generally, payers identify available products that may have indications to treat cancer and have the same biochemical process through which a drug produces its effect. After the FDA approves a drug based on specific indications, the package insert (PI), which is a component of the approval letter, often takes precedence regarding what drug can be prescribed for which indication based on a diagnosis or identification of cancer type.

When ordering products, prescribers have a great deal of discretion based on their clinical judgement. The shift that has taken place with payers’ use of a formulary means that prescribers now must stick closer to the PI for preferred products. Additionally, newer approvals have expanded treatment options for products with similar indications and fewer documented differences between them.

Product Selection

The process of formulary selection for oncology products does vary by payer. Typically, for each payer, a group of payer associates with clinical backgrounds, such as nurses, pharmacists, and physicians, will review lists of potential candidates for exclusion. This payer group often operates under the auspices of the pharmacy and therapeutics (P&T) committee, which reviews multiple factors before coming to their decision that is then validated through a voting process.

During the P&T committee evaluation, many factors may come into play during the selection process, including cost analysis. Most payer organizations will emphasize their main criteria for product selection or deselection based on patient access to medications and clinical appropriateness.

Typically, the P&T committee focuses on assessing the most cost-effective products; however, the measure of cost-effectiveness can include the net price a plan is able to negotiate on behalf of their plan sponsors, which often includes rebates as well as other values.

Furthermore, if the diagnosis and subsequent treatment options include generic alternatives or products with significant price advantages, those products may be favored. With the advent of newer branded options for diagnosis, the P&T committee may favor one brand of oncology product over another—if the data support such a decision. With cost pressures weighed against other considerations that are becoming less relevant to the selection process, such as increased testing, patient quality of life, and unique drug properties, the decision often comes down to cost effectiveness over other concerns.

Some patients have had negative health consequences when they have not been given access to certain prescribed therapies. Because of this, oncology teams and specialty pharmacies are even more vigilant when monitoring patients’ reactions to therapy.

Tactics of Managing Exclusions

When enforcing “rules” around formulary management, payers may deploy several common tools. Typically, oncology teams working with patients use a balanced approach to develop a treatment plan that can best improve patient outcomes. This may include the use of clinical pathways that consider what, if any, treatments may be ideal for the patient versus those that may be excluded from the patient’s drug coverage. When payers are weighing these options, patients can be put in the middle, as they may be given the choice of paying out of pocket for ordered products in their treatment plan versus excluded products. Excluding products has proved to be an effective tool for payers.

Other tactics payers utilize include high cost-share strategies in which the payers cover some portion of the drug cost; however, the patient’s contribution for access to those products can be quite high. This is exacerbated by the significant price points at which many newer oncology products hit the market.

An additional means is the use of step therapy, in which a patient must go through alternative therapies that may cost the plan less, in hopes those treatments will be sufficiently effective; if they are not, the payer may then approve the higher-cost alternative. All these methods have a tremendous impact on how the oncology team develops a multifaceted approach to caring for their patients.

Less aggressive tactics are often referred to as “soft edits” and may include limiting the quantity of the actual product that is dispensed or administered or limiting the estimated day supply. This reduces the amount of potentially wasted product if a particular therapy proves to be less effective than hoped, and limiting the quantity lessens the financial risk. This tactic is best employed for oral therapies that may be dispensed through a specialty or community pharmacy.

Given that payers control nearly 80% of the specialty pharmacy market, they often mandate that any oncology products their pharmacy has access to must be used to fulfil those orders. In these scenarios, the oncology team places an order with the PBM’s specialty pharmacy for oral drugs that are subsequently delivered to the patient’s home. Likewise, for office administered products, the specialty pharmacy ships the ordered product directly to the physician’s clinic, often referred to as “white bagging.”

Patient Impact of Formulary Exclusions

The development of oncology treatment plans is individualized to provide patients with access to every potential treatment necessary to ensure that disease progression slows or stops. Because of this need, oncology products have been the dominant category for new drug applications and approvals over the past several years.

Traditionally, payers have approached cancer care as a “hands off” category in consideration of the life and death consequences. This philosophy has changed dramatically in recent years, and as a result, treatment plans have had to evolve. This evolution has led to first-line therapies often being bumped in favor of preferred formulary products.

Oncology teams have learned from previous patient experiences the importance of proactively excluding those therapies that resulted in a higher use of payer driven alternatives; this is a less patient-centered approach to therapy. Oncology teams are often reluctant to order newer, innovative therapies. As a result, improved patient outcomes can be at risk because delaying those preferred therapies may enable greater disease progression than is necessary. A delay can also lead to having to wait for approval rather than immediately treating the cancer, which can complicate the patient’s therapy. When requested approvals are denied, these rejected patients are forced to switch to secondary or tertiary alternatives, or worse yet, may choose to discontinue therapy all together.

Impact on Oncology Pharmacy

Both individually and through oncology advocacy groups, communication to payers must be enhanced. Leveraging the findings of peer-reviewed studies demonstrating the efficacy and improved outcomes of newer “excluded” therapies over preferred products is essential. Fortunately, most pharmaceutical companies have been proactive in doing the same, and coupled with patient advocacy groups, a larger share of voice is lending itself to this decision.

Additionally, manufacturer-sponsored programs have been effective in helping to offset drug costs, and pharmacy teams should be fully educated on what is available to their patients, including patient assistance programs, co-pay offset initiatives, bridge programs, foundation financial support, and other financially supportive initiatives. This is a perpetual process, and as new data emerge, the advocacy process must evolve as well.

New patient starts are more susceptible to exclusion, but with existing patients, it is important to emphasize the impact of disrupting therapy to payers on their behalf. For patients who have had previous treatment failures, second- or third-line therapies are more eligible for medical exceptions, and thereby fewer rejections. For this purpose, it is beneficial to look for treatment differentiation where products that are less similar therapeutically improve access.

The Future

As oncology drug costs continue to increase, particularly compared with those of other therapeutic areas, more payer control will likely be the result. Advancements in oncology therapy have improved patient outcomes, and at the same time have increased visibility for patient care. Cancer care is no longer a “hands off” category due to the magnitude of the spend. Fortunately, the oncology pipeline is impressive and includes immunotherapies and multiple cell and gene therapies that are anticipated to result in high payer costs. Because of this, oncology pharmacists will have to work even harder as patient advocates to ensure patients have access to their necessary treatment. To advance in this area, it would be beneficial to participate actively with professional associations such as the American Society of Clinical Oncology, the Hematology/Oncology Pharmacy Association, and others as they work through their process with both payers and legislators. Continuing partnerships with patient advocacy groups and the manufacturing community will also be beneficial.

About the Editor

Dan Steiber, RPh operates Genesis Pharma Consultants, a practice responsible for commercial operations and trade—supply chain strategy development. Steiber has served in senior positions in pharmacy, distribution, and industry during his 40-year career and is a licensed pharmacist in Texas, Washington, California, and Pennsylvania.

Related Videos
cancer pain management | Image Credits: © Burlingham - stock.adobe.com
multiple myeloma clinical trial daratumumab/ Image Credits: © Dragana Gordic - stock.adobe.com
multiple myeloma clinical trial/Image Credits: © Studio Romantic - stock.adobe.com
3d rendered illustration of lung cancer 3D illustration - Image credit:  appledesign | stock.adobe.com
pharmacy oncology, Image Credit: © Konstantin Yuganov - stock.adobe.com
Mayo Clinic oncology pharmacy
Therapy session -- Image credit: pressmaster | stock.adobe.com
Testicular cancer and prostate cancer concept. | Image Credit: kenchiro168 - stock.adobe.com
© 2024 MJH Life Sciences

All rights reserved.