Specialty drugs with limited distribution networks require pharmacies to put together an extensive request for proposal to gain access.
To someone not familiar with the term or not involved in contractual relationships, a request for proposal (RFP) might seem related to nuptial agreements between 2 consenting people. However, an RFP in business is documentation provided by a company to a supplier interested in procuring a commodity or service from that supplier.
This request is made through a bidding process, in which the supplier ultimately decides to contract with the requesting company. Therefore, much like a true marriage proposal, 1 party is holding all of the cards and can either accept or deny this proposal. Such is the burden of the modern man and woman, or in this case, business.
Limited Distribution Networks
An RFP is common practice that specialty pharmacies must endure to gain access to certain medications. Many specialty medications, especially high-touch or high-cost medications, often have limited or exclusive distribution networks.
Limited distribution networks are set up by pharmaceutical manufacturers in order to better manage and serve patients taking their medications. Therefore, up to several pharmacies could have access to these medications, while other pharmacies are excluded from this network. Although this practice is frequently debated, the trend for limited distribution networks continues to rise.
It is up to specialty pharmacies to obtain contracts that provide them with the ability to dispense these limited network medications, which is where an RFP comes in. A specialty pharmacy wishing to gain access to certain drugs will submit an RFP in an attempt to convince pharmaceutical manufacturers that they can effectively manage patients and adequately store and dispense their medication.
The RFP Process
Gaining access to an exclusive or limited distribution medication is of high priority to specialty pharmacies, who will spend much time and effort developing RFPs. An RFP is a lengthy set of documents that help manufacturers determine which specialty pharmacies provide services that best fit their needs. Included in these documents are basic information about the pharmacy, as well as financial information.
Additionally, the specialty pharmacy will include details concerning patient care programs and expertise for specific patient populations (such as REMS medications). There is also documentation regarding the ability to store and handle certain types of medications, the assurance that the specialty pharmacy has a broad payer network, and the establishment of patient care metrics, such as phone average speed of answer or number of dropped and abandoned calls. These examples are a small sample of the many qualifications a specialty pharmacy will provide in an RFP.
So You Proposed? When’s the Wedding?
The process for a manufacturer to contract with a specialty pharmacy does not end, nor does it begin, with the submission of an RFP. Typically, a manufacturer will identify a group of potential specialty pharmacies that desire to dispense their product. After being notified from the manufacturer, the specialty pharmacy will then prepare for a site visit from the manufacturer and then submit an RFP.
Submitting an RFP does not guarantee a contract with the manufacturer, and a specialty pharmacy frequently will submit an RFP only to be denied access to the medication. Specialty pharmacies that are able to earn contracts will often offer comprehensive clinical services, extensive abilities to report data and metrics back to the manufacturer, therapeutic expertise, and access to a wide array of patients.
The manufacturer will then see that specialty pharmacy as the total package and a good fit for the product.
Better Luck Next Time
A specialty pharmacy will go to great lengths to produce and deliver a request for proposal. Nevertheless, not earning an exclusive or limited contract is not always an indictment on the pharmacy. Sometimes the pharmaceutical company has identified characteristics that the pharmacy has yet to develop.
If a pharmacy services a high population of transplant patients, then it would be natural if the clinical services in place to treat oncology patients may be lacking compared with other specialty pharmacies.
Much like life, if you want to go after what you want (ie, a specific contract for a specific disease state), you must put in the work to impress. And if a suitor does not find you to be the total package—with all the upcoming specialty medications in the pipeline—chances are another suitor will…hopefully.
About the Author
Alex Toman attended Duquesne University, earning his Doctor of Pharmacy degree in 2011. Alex worked as a retail Pharmacist until 2015, at which time he transitioned into a clinical Pharmacist role within the specialty pharmacy industry. He is currently enrolled in the Masters of Science in Pharmacy Business Administration (MSPBA) program at the University of Pittsburgh, a 12-month, executive-style graduate education program designed for working professionals striving to be tomorrow’s leaders in the business of medicines.