The Role of Consulting in Specialty Pharmacy

Article

Understanding the complicated web of insurers, discounts from government and commercial plans, and payer access is extremely complicated.

Consultant services are a valuable part of the specialty pharmacy space. To bring a new drug to market, clients are confronted by various significant obstacles, such as contracting with payers, designing pricing and reimbursement models, selection of specialty pharmacy/hubs, and designing the patient journey. Each step can pose specific challenges to a client, and knowledge gaps may exist at any stage that could negatively impact a drug launch.

Consultants fill in knowledge gaps and can develop and implement effective strategies that boost a drug’s chances of success. A solid relationship between the right consulting firm and the right client can smooth the process of bringing a therapy to market and assist clients in getting their products into the hands of patients in need of therapy quickly and efficiently.

Consultant services are varied with certain firms specializing in various segments of the market detailed below.

Payer/market contracting

At the heart of a client’s concerns is the question of how they are going to get insurance plans to cover their new therapy. Payers have the largest impact on the financial success of any new drug launch.

Understanding the complicated web of insurers, discounts from government and commercial plans, and payer access is extremely complicated. Consultant firms possess knowledge and relationships within the third-party payer landscape that help ease client concerns and ensure proper contracts are secured with health insurance providers that favorably place therapies on drug formularies and limit the amount of red tape needed to receive plan approval.

Additionally, as health insurance premiums increase and health care costs rise, consultants can work with companies closely to implement new billing models, such as virtual health services and HMOs, that save money for insurers and patients.

Policy, pricing, and reimbursement

Policy and pricing are an ever-moving landscape. There have been multiple drug pricing policy reforms enacted already and further reforms are predicted to release this decade.

Manufacturers must maintain up to date knowledge to understand what has happened and what is on the horizon that may impact pricing. Consultants with knowledge across regulatory bodies can assist manufacturers in understanding the current regulatory framework that impacts pricing so that they can optimize decisions in this arena.

Market and competitive intelligence

Consultants can provide competitive advantages to clients by leveraging their experience within the field to provide comprehensive insights into the market. Firms have years of experience behind them within the market that they use to improve client outcomes though services, such as providing market trends and forecasts.

Channel strategy

When a new drug is coming to market, decisions must be made on which kind of a specialty pharmacy network will be utilized and which specialty pharmacies will participate in that network. Hubs and third-party logistics vendors can also be part of that conversation, as well as the previously discussed insurance payers.

Each entity operates uniquely and sometimes can conflict with how other entities operate. Consultants can assist clients in making channel decisions that can ensure the client’s individualized plan will be implemented, optimizing the patient journey.

Patient services, access, and affordability

Consultants can help improve a client’s brand experience by assisting in the development of patient services. There is a large need for such services, as prescription abandonment and adherence levels are concerningly high even for specialty drug populations.

A consultant can also assist in the development of patient assistance programs that get drugs in the hands of patients most in need of therapy. The medically underserved, underinsured, or those waiting on clearance of sometimes lengthy prior authorization protocols can receive full access to free medication, complete with a suite of patient services through these programs.

Marketing

Client marketing teams must understand how all the pieces of the specialty pharmacy landscape—from providers to payers, patients, and pharmacies—interact to ensure a product launch is successful. Clients can operate cross-functionally to bring a drug from a concept to a launch successfully.

They can assist with product strategy and launch, leveraging knowledge of drug therapeutic opportunities, patient bases, pricing, and reimbursement scenarios, to give the client’s marketing a comprehensive image of the market. By understanding the influence of each stakeholder, a client can better design their marketing strategies.

Partner performance analysis

Data are extremely valuable in today’s specialty pharmacy industry. Data can be utilized to improve every single aspect of a client’s strategy, including marketing, pricing, patient services, and logistics.

Data can also be extremely complicated to gather, aggregate, and understand. Consultants can bring relationships and knowledge of third-party data providers and aggregators to clients and show them how data could be utilized to improve the patient journey. Consultants can also help clients leverage data to better control the physical and financial transactions that support the patient.

Consultant firms generate revenue by charging hourly fees, similar to how an independent contractor or a lawyer might bill for their services. Depending on the level of service required for a given project, consultants can be brought “in house” to have a full-time, in-person office presence, or they can provide services from a distance through their own offices. In addition to hourly fees, consultants can gain revenue through collecting finder’s fees when connecting clients with other service providers/personnel that enhance their outcomes.

Currently there are numerous consulting firms of differing sizes within the market. To highlight a few, TwoLabs Pharma Services is one of the largest at more than 120 employees.

They expanded dramatically in 2018 when they acquired MKO Global Partners and in 2020 when they added CEEK Enterprises.1 Archbow is a medium-sized (<25 employees) consulting firm that was recently acquired by the Omnicom Health Group in April 2021.2

Protean is a smaller consulting firm that specialized in market access, patient services, and payer contracting that was recently acquired by Eversana in October 2021.3 A few consulting firms that are of smaller size include Route3, Perspective3, Katz, and many others.

There are plenty of other players within this market, consisting of various sizes and offering a variety of expertise. Vynamic is a multinational firm that has specialized knowledge in health plants, health care technology, providers, public health regulation, and life sciences.

CSI Group is a firm that exclusively operates as a B2B marketing and creative agency that develops initiatives to improve brand and product recognition. The Dedham Group is a market access firm focused on oncology and specialty therapeutics.

Zensights specializes in vendor/supplier engagement issues. There are many other specialized firms that provide focused expertise in any area of concern a manufacturing client may seek assistance in.

As demonstrated above, the specialty pharmacy consulting space is constantly evolving. New players are being added through startups and others are being acquired or merging.

These activities can have an implication on the overall marketplace. One of the implications is that mergers and acquisitions of firms can lead to an overall reduction in the impartiality of consultant groups in directing business toward certain channels or entities.

The recent acquisition of Protean by Eversana—a leading provider of global consulting services to the life sciences industry—will improve Eversana’s reach and presence, no doubt. It also can potentially impact impartiality and independence of consulting services through conflicts of interest.

Although it is true conflicts of interest are often a part of business, with mergers and acquisitions becoming a regular part of this marketplace, a commonly used and trusted consultant can be acquired by a firm that may pose a conflict of interest. Perhaps the purchaser consults for your primary competitor. Such scenarios can complicate relationships between consulting firms and manufacturers.

Impartiality is a concern within the overall market. Clients not only have to navigate the uncertain waters for which they are hiring consultants, but they also must navigate consultant recommendations in channel decisions knowing that the space has a reputation for partiality.

Often, firms will collect finder’s fees from various channel entities for directing business toward them. This reputation of partiality is acknowledged by the consulting firms themselves.

For example, Blue Fin Group states on their website, “we are very proud to be the only neutral consulting organization in the industry meaning that we do not take any incentives from channels to direct business toward them – which is a common practice in this industry.”4

This quote is telling in that it alleges finder’s fees for channel decisions are widely practiced within the industry to such an extent that a firm believes it can market itself as impartial to gain an advantage over its competition. As the specialty pharmacy market continues to expand over the next several decades, so too will the accompanying consultant services landscape expand.

Consultants can offer valued knowledge and expertise to specialty drug manufacturing clients and help ensure a smooth process when taking a new therapy to market. They often can be THE reason for a specialty drug gaining first mover advantage or achieving dominant market share over competitors.

However, the overall specialty consulting market has a reputation for partiality when directing business toward channels that provide kickbacks to the consulting firms. As the consulting market continues to develop, it will be interesting to witness if this reputation persists.

About the Author

Daniel Paul earned his Bachelor of Science in Biology from Allegheny College and his Doctor of Pharmacy degree from Duquesne University in Pittsburgh. He is currently earning a Master of Pharmacy Business Administration (MPBA) 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. Dan has spent the last 2.5 years working in Specialty Pharmacy, initially as a clinical pharmacist and most recently as the Manager of Pharmacy Operations.

References

  1. Two Labs Acquires MKO Global Partners. https://twolabs.com/two-labs-acquires-mko-global-partners-2/. Accessed January 23, 2022.
  2. Omnicom Health Group Acquires Archbow Consulting. https://www.omnicomgroup.com/newsroom/omnicom-health-group-acquires-archbow-consulting/. Published April 14, 2021. Accessed January 24, 2022.
  3. Eversana Acquires Protean; Strengthens Operational Strategy and Excellence in Market Access, Channel and Patient Services. https://www.prnewswire.com/news-releases/eversana-acquires-protean-strengthens-operational-strategy-and-excellence-in-market-access-channel-and-patient-services-301401393.html. Published October 15, 2021. Accessed January 24, 2022.
  4. Blue Fin Group, An IntegriChain Company website. https://consultbfg.com/. Accessed January 24, 2022.
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