What Influences Pharmacies to Dispense Payer Preferred Drugs?

Study finds dispensing behavior to be largely compliant with payers, especially in competitive regions.

To control costs, private and public payers try various strategies to influence pharmacies’ dispensing behavior. Such strategies usually involve incentives to encourage the selection or substitution of particular products, brands, and generics.

A German study published in Health Policy investigated the dispensing behaviors of individual pharmacies and examined characteristic variables such as local competition to ascertain how these factors might influence dispensing choices.

For their cross-sectional retrospective study, researchers defined 3 outcome variables:

  • Share of imported (ie, parallel-traded) pharmaceuticals
  • Share of generics
  • Share of preferred brands dispensed

Preferred brands refer to the third party payer’s perspective, outlined in their guidelines.

To focus only on pharmacists’ choices based on current payer guidelines, investigators excluded any prescription with confounding influences or restrictions, and limited their data calculations only to prescription fills that compelled a pharmacist to actively choose between more than 1 viable drug option.

Variables of interest for each pharmacy were organizational capacity, competitive environment, use of mail-order fulfillment, and online advertising efforts.

Control variables accounted for characteristics of the pharmacies’ regions, prescribing physicians, and patient age, income, gender, and participation in a disease management program (DMP).

A very large dataset of 49,260,902 prescriptions from 16,797 pharmacies was identified from Germany’s largest sickness fund, the Techniker Krankenkasse (TK). In 2013, the TK insured 8.4 million individuals, about 12% of the 90% of all Germans who are covered by statutory health insurance.

Supporting data on the investigated pharmacies were gathered from other public databases: the Federal Institute for Research on Building, Urban Affairs and Spatial Development; the mail-order pharmacy register of the German Institute for Medical Documentation and Information; and special pharmacy services listed by the German Publishing Company of Pharmacists.

Outcome measures were analyzed descriptively and by regression model.

Findings on Pharmacy Dispensing Behavior

Dispensing imported (parallel-traded) pharmaceuticals was an option for 4,184,536 prescriptions. Of these, the average share of imports dispensed was 20.7% (SD 9.2), while 35,305,031 prescriptions qualified for generic substitution. The average share of generics dispensed was 92.8% (SD 2.1).

On average, pharmacists dispensed payers’ preferred brands 81.3% of the time (SD 5.9).

Some other significant findings from their analyses were:

  • Higher competition among pharmacies significantly increased use of imported, generic, and preferred brand drugs.
  • Pharmacies with higher organizational capacity were more compliant with payers.
  • Pharmacies with mail-order services were less compliant with payers.
  • For those who advertised online, share of imports was lower, share of preferred brands was higher, and share of generics was unaffected.
  • Compliance with preferred brands was lower in urban districts.
  • Patients with chronic diseases used a smaller share of imports, a larger share of generics, and a greater share of preferred brands compared with other patients.
  • Generic share and compliance with preferred brands were higher for older patients.

The study concluded that pharmacies dispense drugs at a generally high rate of compliance with payers’ guidelines. Competition between pharmacies seems to be a motivating factor for more compliant dispensing behavior. Pharmacies with little competition, usually in sparsely populated areas, dispensed fewer imported drugs (P<.001), fewer generics (P<.001), and fewer preferred brands (P<.001). Less organized pharmacies yielded similar results. Ready availability of product stock could be a possible explanation for these variances.