RADAR on Specialty Pharmacy

FDA Grants Tentative Approval to Extended-Release Narcolepsy Agent

A new formulation of a narcolepsy drug may get uptake among providers, according to Zitter Insights research. But payers indicate that they are likely to require patients to fail at least one generic drug before getting access to the new agent and other branded medications. Still, the agent’s less onerous dosing may allow it to pull market share from similar medications within the class.

On July 19, Avadel Pharmaceuticals plc said that the FDA had granted tentative approval to its Lumryz (sodium oxybate) for the treatment of excessive daytime sleepiness or cataplexy — an abrupt loss of muscle tone that can be triggered by strong emotion — in adults with narcolepsy. The drug — which is also known as FT218 — is a once-at-bedtime extended-release version of Jazz Pharmaceuticals plc’s Xyrem, a drug that requires one dose at bedtime and then another dose between two-and-a-half to four hours later.

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Specialty Pharmacy’s Dose Optimization Program Saved More Than $6 Million Last Year

As spending on specialty drugs continues to rise, payers are implementing various utilization management strategies in an effort to rein in their costs. While prior authorization and step therapy are perhaps the most common tactics, other approaches, such as quantity limits, site-of-care optimization and dose optimization also can be successful tools, as evidenced by one specialty pharmacy’s recent announcement.

In September, AllianceRx Walgreens Pharmacy revealed that its use of dose optimization resulted in $6.2 million in savings in 2021. The strategy reduces the number of dispensed units of an oral, injectable or infusible agent while delivering the same appropriate dose. Some manufacturers charge the same or similar price for different doses of a drug, so if a patient is given a prescription for two 10 mg tablets per day, and a 20 mg tablet is available, it can be more efficient and economical for the patient to take the single 20 mg tablet.

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New FDA Approvals: FDA Approves Sotyktu

Sept. 9: The FDA approved Bristol Myers Squibb’s Sotyktu (deucravacitinib) for the treatment of adults with moderate-to-severe plaque psoriasis who are candidates for systemic therapy or phototherapy. The agent is a first-in-class, oral, selective, allosteric tyrosine kinase 2 (TYK2) inhibitor. The recommended dosage of the tablet is 6 mg once daily. The list price for a 30-day supply is $6,164.

Sept. 9: The FDA approved Spectrum Pharmaceuticals, Inc.’s Rolvedon (eflapegrastim-xnst) to decrease the incidence of infection, as manifested by febrile neutropenia, in adults with nonmyeloid malignancies receiving myelosuppressive anti-cancer drugs associated with clinically significant incidence of febrile neutropenia. The manufacturer says it is the first novel long-acting granulocyte colony-stimulating factor (G-CSF) approved in more than 20 years. The recommended dose is 13.2 mg administered subcutaneously once per chemotherapy cycle. The company says it expects the product to be available in fourth-quarter 2022.

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News Briefs: Dr. Reddy’s Launched Six Strengths of Lenalidomide

Dr. Reddy’s Laboratories Ltd. launched six strengths of lenalidomide, and two of them — 2.5 mg and 20 mg — are eligible for first-to-market 180-day exclusivity, the company said Sept. 7. The FDA approved those two strengths and gave tentative approval to the others on Oct. 14, 2021. Teva Pharmaceuticals Ltd. launched the first generics of the other four strengths of the generic of Bristol Myers Squibb’s Revlimid — 5 mg, 10 mg, 15 mg and 25 mg — on March 7. Lenalidomide is approved for six indications for the treatment of adults with (1) multiple myeloma in combination with dexamethasone; (2) MM as maintenance treatment following autologous hematopoietic stem cell transplantation; (3) transfusion-dependent anemia due to low- or intermediate-1-risk myelodysplastic syndromes associated with a deletion 5q abnormality with or without additional cytogenic abnormalities; (4) mantle cell lymphoma that has relapsed or progressed after at least two treatments, including bortezomib; (5) previously treated follicular lymphoma in combination with a rituximab product; and (6) previously treated marginal zone lymphoma in combination with a rituximab product. On Sept. 17, 2020, Dr. Reddy’s said that it had settled patent litigation with Bristol Myers subsidiary Celgene Corp. that would allow it to sell volume-limited amounts of the generic as of a confidential date after March 2022. As of Jan. 31, 2026, Dr. Reddy’s can sell lenalidomide without limitation.

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Questions Exist Around Some Alternate Funding Companies That Carve Out Specialty Drugs

With companies trying to keep their prescription drug spending down, some have turned to alternate funding companies. While their approaches may seem appealing initially, some — such as ones that carve out certain specialty drugs and seek coverage from patient assistance funds — may not be worth the investment, say industry sources, who encourage companies to take a closer look at what their savings actually are.

During a July 29 webinar titled Specialty Drugs Update: Trends, Controversies, and Outlook, longtime industry expert Adam J. Fein, Ph.D., CEO of Drug Channels Institute, noted that while the use of copay accumulators and maximizers has risen, “there is another newer trend that’s even scarier, and that’s the business of what some people call specialty carve-outs,” he said, calling this “the shady business of specialty carve-outs.” Vendors such as ImpaxRX, Paydhealth, SHARx, PayerMatrix and Script Sourcing get payers to exclude specialty drugs and then get those drugs covered via patient assistance programs at manufacturers or charitable foundations. If patients are denied patient assistance, coverage reverts to the company’s payer/PBM/specialty pharmacy.

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Walgreens’ Purchase of Remaining Shields Stake Signals Threat to Independent Specialty Pharmacy Landscape

After increasing its share in Shields Health Solutions last year, Walgreens Boots Alliance, Inc. has entered into an agreement to purchase the remaining stake of the health system-owned specialty pharmacy integrator. The move, says one industry expert, may represent one more step in putting independent specialty pharmacies out of business.

After making incremental investments in Shields, Walgreens said on Sept. 20 that it would purchase the remaining 30% stake for approximately $1.37 billion. Shields — which partners with health systems to help them create and grow a hospital-owned specialty pharmacy program — has served more than 1 million people and has almost 80 health system partners that represent nearly 1,000 hospitals across the U.S. Shields will operate as a separate business and brand within Walgreens.

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New FDA Approvals: FDA Converts Accelerated Approval to Full for Tabrecta

Aug. 10: The FDA converted the accelerated approval for Novartis Pharmaceuticals Corp.’s Tabrecta (capmatinib) to full approval for the treatment of adults with metastatic non-small cell lung cancer (NSCLC) whose tumors have a mutation that leads to mesenchymal-epithelial transition (MET) exon 14 skipping as detected by an FDA-approved test. The agency granted that accelerated approval on May 6, 2020. Dosing of the tablet is 400 mg twice daily. GoodRx lists the price of 112 200 mg tablets as more than $19,667.

Aug. 11: The FDA gave accelerated approval to AstraZeneca and Daiichi Sankyo, Inc.’s Enhertu (fam-trastuzumab deruxtecan-nxki) for adults with unresectable or metastatic NSCLC whose tumors have activating HER2 (ERBB2) mutations as detected by an FDA-approved test (see below briefs) and who have received a prior systemic therapy. This is the first drug that the agency has approved for HER2-mutant NSCLC. The FDA first approved the antibody drug conjugate on Dec. 20, 2019. The drug received priority review and breakthrough therapy designation. Dosing for the newest use is 5.4 mg/kg via intravenous infusion once every three weeks.

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Johnson & Johnson Files Lawsuit Against Copay Maximizer Company SaveOnSP

Multiple companies that provide alternate funding options for patients have been launching over the last several years. But one maximizer company has found itself the target of a legal battle with manufacturer Johnson & Johnson over its strategy to reclassify drugs and maximize the copay assistance it gets from pharma manufacturers.

Copay maximizers have companies classify some drugs as “non-essential health benefits” (NEHBs) as outlined in the Affordable Care Act (ACA). They then secure patient assistance for these drugs through manufacturers’ or charitable foundations’ patient assistance programs, taking the full annual amount of assistance per drug and spreading out that money over the course of the year (see story). The programs are seen as follow-on offerings to copay accumulators, which take the maximum assistance up front and deplete the contribution before the end of the year.

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Copay Maximizer Programs Are Coming Under Fire

Multiple companies are offering copay maximizer — also known as variable copay — programs. And while they may be attractive to firms that implement them, a closer look might reveal them to be not as appealing as they seem at first blush, say industry experts. The programs also are being challenged in legal settings, including a lawsuit by manufacturer Johnson & Johnson against SaveOnSP (see story).

Traditionally, when a manufacturer provides copay assistance for one of its drugs, that dollar amount would count toward the patient’s deductible and out-of-pocket maximum. But copay maximizer programs will distribute 100% of available manufacturer copay offset funds over 12 months, as opposed to copay accumulators, which apply the maximum manufacturer assistance up front and deplete that contribution before the end of the year. Payments in both approaches do not count toward members’ deductibles and out-of-pocket maximums.

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News Briefs: Cancer Replaced Musculoskeletal Conditions as Biggest Driver of Large Companies’ Health Care Costs

Cancer replaced musculoskeletal conditions as the biggest driver of large companies’ health care costs, according to the Business Group on Health’s 2023 Large Employers’ Health Care Strategy and Plan Design Survey. The survey found that “13% of employers said they have seen more late-stage cancers and another 44% anticipate seeing such an increase in the future, likely due to pandemic-related delays in care.” Between May 31, 2022, and July 13, 2022, the organization polled 135 large employers in various sectors that cover more than 18 million people in the U.S. The survey also found that 99% of respondents said that they are concerned about prescription drug trend. Last year, prescription drugs were responsible for a median of 21% of the companies’ health care costs, and specialty drugs accounted for more than half of pharmacy spend.

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