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Firms Develop Strategies for Specialty Drugs

April 10, 2009
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Faced with the high cost of specialty drugs, many employers are relying more on strategies from specialty arms of their pharmacy benefit managers to control spending.

Specialty pharmaceuticals, or biological drugs, are made from living organisms rather than chemical compounds and are prescribed for multiple sclerosis, hepatitis C, cancer and certain other diseases and conditions.

Biologics may be injected, infused, taken orally or inhaled. Many require special transportation and storage.

A specialty drug costs an average of $1,600 a month. Biologics can cost up to $300,000 a year. Such drugs make up 24 percent of an employer’s drug spending and are projected to be 44 percent by 2030, says Dr. Brian Solow, vice president and medical director of clinical programs at Prescription Solutions, an Irvine, California-based PBM and unit of UnitedHealth Group.

A specialty pharmacy provides drugs at a discount, special shipping and handling, patient education and proactive management, including patient training on self-injected biologics so the patient adheres to the therapy and avoids potentially expensive complications.

General Motors looks to its PBM, Franklin Lakes, New Jersey-based Medco Health Solutions, to implement "a really comprehensive program to make sure the patient gets the right drug at the right time," says Cynthia Kirman, director of GM’s clinical pharmacy initiatives in Detroit.

"It’s a pretty rigorous process," Medco oversees drug dispensing and patient education for GM employees through retail specialty networks as well as its mail-order specialty pharmacy, Accredo Health Group Inc., Kirman says.

"Many specialty drugs are getting additional indications, which doubles their use. The classic example is Enbrel," says Joanne Sica, director and national pharmacy practice leader at PricewaterhouseCoopers HR Services in Philadelphia. The Food and Drug Administration initially approved using Enbrel for rheumatoid arthritis. The FDA later gave additional indications, or approval to use, for juvenile arthritis and severe psoriasis, she said.

"Unless the psoriasis is severe, patients should start with a cream or tablets" to see if they bring relief, rather than using a much more expensive biologic, says Steve Russek, chief clinical officer at Accredo.

A specialty pharmacy also monitors treatment to avoid waste and overuse, says Russek, who is based in Franklin Lakes. For example, a care coordinator and specialist pharmacist at Accredo collaborated to modify dosage of a medication for a young patient with hemophilia. The health plan saved more than $44,000 during the course of a year, Accredo says.

Absent a specialty pharmacy, the patient’s physician supplies the drug at a markup and charges the insurer, often leaving the employer "blinded" to the cost, Sica says.

But only half of biological drugs are screened and paid for by PBMs, says John Malley, national practice leader of pharmacy benefit consulting at Watson Wyatt Worldwide in New York. "Clearly, some employers out there are not doing anything to manage these drugs and this will be a rogue wave that eventually is going to hit them," he says.

Coordinated disease management provided by an employer’s health insurer and a specialty pharmacy "would be an employer’s best bet" to control the cost of specialty drugs, Solow says.

At Las Vegas-based Boyd Gaming, Cigna Pharmacy Management manages specialty drugs whether dispensed by physicians or its specialty pharmacy, a strategy that has kept its drug spending under control for its 21,000 employees, says Bob Berglund, vice president of employee benefits and insurance.

While some employers require a higher employee co-payment for specialty drugs, Boyd Gaming’s maximum drug co-pay is $150 a month—even for the 100 employees whose specialty drugs cost $5,000 a month, Berglund says.

The benefit "builds up a sense of loyalty. These people understand that the drugs are saving their lives," Berglund says.

GM is among employers that charge higher co-pays for specialty drugs. "The first thing we do is to make sure it’s the right drug for that patient and that they understand the importance of the medication so they continue to take it," Kirman says. Patient education works to ensure adherence, she says.

Using its coordinated approach, Aetna Specialty Pharmacy has achieved 94 percent adherence for eight conditions for which the patient is on case management, says Dr. Edmund Pezalla, national medical director of Aetna Pharmacy Management in Hartford, Connecticut.

For Prescription Solutions, Solow says data have been submitted for publication that show improved adherence among multiple sclerosis patients taking injectable drugs.

Specialty approaches to biologics even have spread to the retail level.

This month, nurse practitioners at CVS Caremark’s MinuteClinics began training individuals on how to self-inject drugs, which typically costs less than visiting a doctor or a home health aide, a spokesman says.

Walgreens’ Take Care Employer Solutions in Conshohocken, Pennsylvania, which operates customized work-site medical centers, offers infusion of specialty drugs at a medical center sponsored by a large pharmaceutical company employer. The convenience will encourage adherence and improve productivity, says Dr. Cornell Pearcy, Take Care’s mid-Atlantic regional medical director in Moorestown, New Jersey.

Pittsburgh-based Walgreens Specialty Pharmacy also has launched a pilot at its retail Take Care clinics in Florida that offers infusions and injections.

On another front, the Coalition for a Competitive Pharmaceutical Market, GM and other large employers support bipartisan legislation to allow the Food and Drug Administration to create a regulatory pathway to approve generic biologics, Kirman says. Even if a generic were to become available at only a 1-2 percent discount, "those are large dollars."

Employers should "push their consultant, health plan and PBM to come up with creative ways to manage the cost of these drugs," Sica says. "Stay on top of this. Because if you don’t, it’s going to run over you."

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