Featured Health Business Daily Story, Feb. 16, 2017

Agreement Will Leverage Data to Support Outcomes-Based Contracts (with Chart: Jardiance: Percentage of Plans by Coverage Status, ST, PA Requirements)

Reprinted from DRUG BENEFIT NEWS, biweekly news and proven cost management strategies for health plans, PBMs, pharma companies and employers. Sign up for an $86 two-month trial subscription today.

By Angela Maas, Managing Editor
February 3, 2017Volume 18Issue 3

Avalere Health recently unveiled a deal that should help Boehringer Ingelheim Pharmaceuticals, Inc. (BI) and Eli Lilly and Co. construct value-based deals with payers for one of their diabetes drugs. As the U.S. health care system transitions from a fee-for-service to a fee-for-value system, such contracts are becoming more popular.

The arrangement is specific to the BI/Lilly diabetes drug Jardiance (empagliflozin), clarifies Dan Mendelson, president of Avalere, an Inovalon Holdings Inc. company. The FDA initially approved the drug in 2014 for use along with diet and exercise to lower A1C in adults with type 2 diabetes. But in December, the agency approved a new indication: to lower the risk of cardiovascular death in adults with type 2 diabetes and cardiovascular disease.

“BI is establishing a leadership position in value-based purchasing,” Mendelson tells AIS Health. “With the new indication for Jardiance, plans are interested in engaging BI on a data-enabled basis.”

Drug Benefit News

According to data from Managed Markets Insight & Technology, LLC, which is the parent company of AIS Health, 91% of all plans nationally cover Jardiance (see box).

Deal Will Translate Outcomes Into Practice

According to Inovalon, “The agreement utilizes Inovalon and Avalere’s combined breadth of healthcare capabilities and integrated platform supporting greater customer insight, data integration and analytics and integrated provider and patient-level intervention capabilities. This will support outcomes based contracting and help translate clinical outcomes into real world practice to ultimately improve patient clinical care.”

The partnership came about, says Mendelson, because “BI needed a partner with deep data resources (with lab values), established analytic capabilities and the ability to intervene with patients on behalf of health plans. After its merger with Inovalon [in September 2015], Avalere has all of these capabilities, and also has a long, established relationship with BI.”

The company’s database contains more than 130 million patients, and Avalere “analyze[s] these data to create algorithms for clinical improvement,” Mendelson explains. For the BI/Lilly deal specifically, “We will look at established outcomes (e.g., A1C counts) and the outcomes measures we expect to be used in the future (e.g., time in range). We will also look carefully at the data to identify other outcomes and process measures (e.g., adherence) that are useful.”

Diabetes is a condition that’s well-suited for outcomes-based contracting because “It’s highly prevalent and also frequently associated with quality payments,” such as in Medicare Advantage, he says (DBN 1/18/16, p. 1).

In addition to diabetes, Inovalon also has implemented quality-improvement activities for more than 120 health plans in cardiovascular disease, pulmonary, rheumatoid arthritis and “other areas that are associated with quality-based payment to health plans,” Mendelson says.

Specifically with respect to diabetes, these activities include “adherence to medications using prescription fill data, identification of patients who are likely to become diabetic using lab values and engagement with physicians who can improve their engagement with diabetic patients.”

Mendelson points out that Avalere has a similar arrangement with Bristol-Myers Squibb Co. that was unveiled last May. He clarifies that Avalere has not disclosed either the therapy areas or the drugs that the two companies are working on. He also declines to disclose any outcomes of the partnership.

Asked what components are needed for outcomes-based contracts to be successful, Mendelson cites “deep data capabilities (with patient identified data), a library of outstanding algorithms that are calibrated constantly and the ability to intervene. Also, a neutral third party,” such as Avalere, “needs to be trusted by both the health plan and the life sciences company to be a faithful reporter of the patient experience.”

Jardiance: Percentage of Plans by Coverage Status, ST, PA Requirements

Jardiance (empagliflozin) is covered under 91% of all plans nationally and is preferred on 64%. The Boehringer Ingelheim Pharmaceuticals, Inc. and Eli Lilly and Co. drug is indicated for use in adults with type 2 diabetes to lower A1C and to decrease the risk of cardiovascular death. Step-therapy (ST) protocols are in place for Jardiance on 41% of plans, with more than half requiring a generic trial. Prior authorization (PA) is required by 24% of plans. 

 Percentage of Plans by Coverage Status, ST, PA Requirements

SOURCE: MMIT Analytics, as of Jan. 30, 2017, www.mmitnetwork.com.


AIS’s Rx Benefit Data is an online subscription database with detailed data and insight on the medical and prescription drug benefit designs of commercial health plans. Learn more and check out a free interactive demo of the database!

Copyright © 2017 Managed Markets Insight & Technology, LLC. All Rights Reserved.

It's quick and easy to sign up for FREE access to AISHealth.com!

Why do I need to register?