Drug Benefits

Trump’s Drug Importation Plan Faces Significant Hurdles

August 13, 2019

Amid an ongoing outcry against rising drug costs, the Trump administration recently introduced two importation pathways to reduce what U.S. residents pay for drugs.

Under the Safe Importation Action Plan, the first pathway would allow states, wholesalers and pharmacists to propose to HHS demonstration projects for importing certain drugs from Canada. Under the second pathway, drug manufacturers could import non-U.S. countries’ versions of their drugs into the United States.

By Aine Cryts

Amid an ongoing outcry against rising drug costs, the Trump administration recently introduced two importation pathways to reduce what U.S. residents pay for drugs.

Under the Safe Importation Action Plan, the first pathway would allow states, wholesalers and pharmacists to propose to HHS demonstration projects for importing certain drugs from Canada. Under the second pathway, drug manufacturers could import non-U.S. countries’ versions of their drugs into the United States.

What do health plan executives need to worry about with these two pathways? Not much, at least not in the next couple of years, according to Jigar Thakkar, Pharm.D., a managing director at FTI Consulting.

“There are so many hurdles that this isn’t something that’s going to happen tomorrow or in the next year or two,” Thakkar says. The hurdles include passage of legislation to allow biologics such as insulin to be imported and the ability of drugs imported from other countries to be tracked via FDA-TRACK, the FDA’s agency-wide performance system that monitors drugs during their journey from manufacturer to distributors to pharmacies.

Another significant hurdle is pushback from interest groups in Canada. Bloomberg News reported that the Canadian Medical Association and 14 other groups sent a letter to Canada Health Minister Ginette Petitpas Taylor protesting the Trump administration’s moves.

Deb Devereaux, senior vice president of pharmacy at Gorman Health Group, isn’t optimistic about the success of the first pathway where drugs would be imported to the United States from Canada. “The bottom line is the Canadian drug supply would be exhausted in 16 months with all the U.S. states trying to avail themselves of Canadian drugs,” she says.

Datapoint: Medicare Will Cover Costly CAR-T Therapies

August 12, 2019

CMS last week finalized its decision to cover CAR-T cell treatments, as well as all services related to administration of the costly therapy. Available CAR-T therapies have been slow to pick up coverage due to their high list prices, with Gilead’s Yescarta priced at $373,000 and Novartis’ Kymriah at $475,000. CMS currently facilitates coverage for 33,301,406 people through Medicare fee-for-service.

CMS last week finalized its decision to cover CAR-T cell treatments, as well as all services related to administration of the costly therapies. Available CAR-T therapies have been slow to pick up coverage due to their high list prices, with Gilead’s Yescarta priced at $373,000 and Novartis’ Kymriah at $475,000. CMS currently facilitates coverage for 33,301,406 people through Medicare fee-for-service.

Source: AIS’s Directory of Health Plans

PBMs Offer High-Touch Care Management for Chronic Conditions

August 12, 2019

Though PBMs are most known for the influence they have on prescription drug costs, some firms are increasingly focused on offering high-touch condition management services that give them a more active role in patient care.

For specialty PBM AscellaHealth, LLC, that means harnessing a variety of resources to help better manage treatment for hemophilia, a notoriously expensive disease state.

By Leslie Small

Though PBMs are most known for the influence they have on prescription drug costs, some firms are increasingly focused on offering high-touch condition management services that give them a more active role in patient care.

For specialty PBM AscellaHealth, LLC, that means harnessing a variety of resources to help better manage treatment for hemophilia, a notoriously expensive disease state.

Not only does the PBM leverage its specialty pharmacy network to obtain the best prices for hemophilia clotting factor, but it also uses technology to monitor medication dispensing in real time and provides clinical interventions when necessary, explains Mike Baldzicki, AscellaHealth’s executive vice president of growth and strategy.

“Managing cost and quality kind of go hand in hand in this regard,” adds Dea Belazi, the PBM’s CEO.

Meanwhile, CVS Health Corp. is expanding its Transform Diabetes Care program, which helps members of its PBM, Caremark, control their diabetes by providing technology-enabled, personalized support and coaching focused on improving medication adherence and controlling blood-sugar levels. As part of the expansion, the program will also focus on the prevention and early identification of diabetes as well as hypertension, which is twice as common in diabetes patients as the regular population.

While care-management programs are hardly a new concept in the health care industry, “the new part, I would say, is putting the PBM at kind of the center of these programs,” says Ashraf Shehata, a principal in KPMG’s health care life sciences advisory practice and the firm’s Global Healthcare Center of Excellence.

In the PBM space, firms are increasingly integrating traditional medication therapy management with connected medical devices “to help create a much more visible data and information stream around people’s ability to successfully accomplish their medication regimen,” he says.

More Than 1M Medicare Part D Enrollees Had High Out-of-Pocket Drug Spending in 2017

August 2, 2019

About 1 million Medicare Part D beneficiaries without low-income subsidies (LIS) had out-of-pocket prescription drug spending above the catastrophic threshold in 2017, with the average annual OOP cost reaching $3,214, according to a recent Kaiser Family Foundation analysis. As Part D does not place a hard cap on OOP spending, enrollees are required to pay up to 5% of their total drug costs for spending above the catastrophic threshold, unless they receive LIS.

by Jinghong Chen

About 1 million Medicare Part D beneficiaries without low-income subsidies (LIS) had out-of-pocket prescription drug spending above the catastrophic threshold in 2017, with the average annual OOP cost reaching $3,214, according to a recent Kaiser Family Foundation analysis. As Part D does not place a hard cap on OOP spending, enrollees are required to pay up to 5% of their total drug costs for spending above the catastrophic threshold, unless they receive LIS. Over the past decade, the share of OOP spending in the catastrophic coverage phase has increased among Part D enrollees with high OOP drug costs, from 13% in 2007 to 44% in 2017. The Affordable Care Act’s changes to Part D benefit design, which included a manufacturer discount on brand-name drugs while in the coverage gap, contributed to that growth.

NOTE: “High out-of-pocket drug costs” refers to Part D enrollees without low-income subsidies who incurred drug spending above the catastrophic coverage threshold. Analysis of top 10 drugs is limited to drugs with 100 (500 weighted) or more users in 2017.

SOURCE: Kaiser Family Foundation, “How Many Medicare Part D Enrollees Had High Out-of-Pocket Drug Costs in 2017?” KFF analysis of 2007-2017 prescription drug claims data from the CMS Chronic Conditions Data Warehouse. Visit https://bit.ly/2FsYW3c.

Congress Eyes Measures That Could Affect PBMs

August 1, 2019

Now that the Trump administration has abandoned its bid to overhaul the Medicare Part D drug rebate system, all eyes are on what Congress will do to address the ever-vexing problem of high drug prices.

While some ideas lawmakers are considering could be very problematic for PBMs, industry analysts are dubious about their prospects. Other less-drastic changes, though, could make it into law.

By Leslie Small

Now that the Trump administration has abandoned its bid to overhaul the Medicare Part D drug rebate system, all eyes are on what Congress will do to address the ever-vexing problem of high drug prices.

While some ideas lawmakers are considering could be very problematic for PBMs, industry analysts are dubious about their prospects. Other less-drastic changes, though, could make it into law.

“The bottom line is [that] the most hurtful, the most damaging proposals, at least looking at it from a PBM perspective, we do not think that they will pass,” says Ji Liu, an analyst for the credit rating firm Standard & Poor’s (S&P). Liu and his colleagues recently released a report that analyzes how a handful of health care reform proposals might affect PBMs’ creditworthiness.

One proposal discussed in the report that has since become a more concrete possibility is a package of drug-pricing reforms from the Senate Finance Committee, which includes provisions that put inflation caps on Medicare Part D and Part B prices.

“Depending on how the maximum allowable inflation limit is set, we could see some modest pressure for PBMs,” which generally benefit from higher branded drug inflation because part of their revenue is tied to the list price, S&P’s report says.

In addition to the inflation caps and a slew of other provisions, the Senate Finance Committee’s drug-pricing bill would implement an out-of-pocket spending cap in Part D.

Alex Shekhdar, founder of Sycamore Creek Healthcare Advisors, says it makes sense for Congress to enact a policy that directly affects consumers’ out-of-pocket drug costs.

“Whatever policy comes to pass will focus on changing the price point that the consumer experiences,” he says, adding, “it’s a simpler lift that gets a lot of political gain.”

Datapoint: Pfizer’s Rituxan Biosimilar Scores FDA Nod

July 30, 2019

The FDA last week approved Pfizer’s Ruxience, a biosimilar to Roche’s Rituxan, for the treatment of chronic lymphocytic leukemia, non-Hodgkin lymphoma, microscopic polyangiitis and granulomatosis with polyangiitis. For the treatment of chronic lymphocytic leukemia, Rituxan currently holds preferred status in the pharmacy benefit for just 5% of all covered lives, growing to 18% with prior authorization and/or step therapy.

The FDA last week approved Pfizer’s Ruxience, a biosimilar to Roche’s Rituxan, for the treatment of chronic lymphocytic leukemia, non-Hodgkin lymphoma, microscopic polyangiitis and granulomatosis with polyangiitis. For the treatment of chronic lymphocytic leukemia, Rituxan currently holds preferred status in the pharmacy benefit for just 5% of all covered lives, growing to 18% with prior authorization and/or step therapy.

SOURCE: MMIT Analytics, as of 7/26/19