CHICAGO —
With no end in sight to the rise in specialty drug prices, experts urge
employers to be creative in managing those costs — from building custom
networks to holding pharmacy benefit managers accountable for treatment
outcomes.
Drugmakers
have received the brunt of public outrage for the high prices of some
specialty drugs, which require special handling and are used to treat
diseases such as cancer, hepatitis C and rheumatoid arthritis. Many
specialty drugs are pricey: Epclusa, Gilead Sciences Inc.'s hepatitis C
drug that the U.S. Food and Drug Administration approved last week,
comes to market at about $75,000 for a single course of treatment.
Specialty
drug spending rose 17.8% in 2015, according to PBM Express Scripts
Holding Co., and spending is expected to continue increasing with
several oncology drugs in the FDA pipeline.
But experts say employers should be aware of the many middlemen, from PBMs to retailers, that profit from the drug.
“When
it comes to the distribution of drugs, every time that drug passes
through another hand, there's a margin that's captured by whoever is
handling it. Whether it's the wholesaler, retailer or a doctor,
everybody's getting a piece,” said Alex Jung, Chicago-based principal of
global strategy at Ernst & Young L.L.P.
PBMs, she said, happen to be “one of the biggest expenses” in marking up the cost of the drug.
But
employers aren't doing enough to hold middlemen accountable for the
costs they add to the prescription drug bill, and few employers have
custom pharmacy networks and direct contracts with health care providers
to ensure they pay the lowest costs but get the best outcomes for their
employees, she said last week during the Midwest Business Group on
Health's Employer Forum on Pharmacy Benefits and Specialty Drugs in
Chicago.
Employers
need to understand what diseases are prevalent among their employees
and “construct a network that meets your needs by looking at a provider
that serves those needs from a therapeutic perspective,” she said. “You
can't just say I'm going to follow whatever Boeing (Co.) does or
whatever United Airlines (Inc.) does, because ... they're not creating a
customized specific benefit plan that meets the needs of the specific
therapeutic diseases that are prevalent in your population.”
But
most employers don't have the expertise to navigate the prescription
drug industry or devise custom pharmacy networks. And only employers
with thousands of employees have the power to form direct contracts,
experts say.
Additionally,
the lack of drug industry transparency makes it nearly impossible to
know which middlemen are driving “unwarranted margins” along the supply
chain, Michael Thompson, Washington-based president and CEO of the
National Business Coalition on Health, said in an interview at the
forum.
“If
we have full transparency, we will easily negotiate (the margins) out.
But the problem is, it's a shell game,” Mr. Thompson said.
Employer strategies
Still, there are strategies employers can use to avoid wasteful specialty drug spending.
For
one, employers should have PBMs and other providers monitor patient
medication adherence to ensure good treatment outcomes, Chris Compisi,
general manager of national accounts for U.S. managed health care at
Abbvie Inc. in North Chicago, Illinois, said during a panel discussion.
“Make
that part of your (request for proposal) process, to demand that
(vendors) capture the outcome of the associated adherence or the
associated result of the investment that you have in a high-cost
specialty medication,” he said.
Employers
also can incentivize employees to take their medications as prescribed,
said Sandra Morris, former senior manager of U.S. benefits design at
Procter & Gamble Co. and now a consultant at her firm About Quality
Benefits Design L.L.C. in Cincinnati
“I
think there is going to be a lot more movement by the payers for the
patients to have skin in the game,” Ms. Morris said during a panel
discussion.
Utilization
management, site-of-care management and narrowing pharmacy networks are
other cost-cutting strategies, said Atheer Kaddis, executive vice
president of sales and strategic alignment at specialty pharmacy
Diplomat Pharmacy Inc. in Flint, Michigan.
Among
the most effective strategies, according to Diplomat data, is managing
where employees have their medications administered — a tactic that can
lead to savings of up to 30% on specific drugs — and limiting
prescriptions for high-cost drugs to 15-day supplies instead of 30 days,
which can lead to savings of up to 20% on targeted medications, Mr.
Kaddis said.
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