Spotlight on Market Access

In the product launch phase, pharmaceutical manufacturers are under pressure to commercialize quickly and deliver early revenue growth. Establishing early, competitive access to payers and PBMs is crucial to meeting this challenge, and MMIT Landscape uniquely addresses these needs.

The state of Tennessee controls 1.2 million Medicaid drug lives in four formularies as of January 2021. Tennessee is unique among states in that the vast majority of its Medicaid beneficiaries are enrolled in managed care plans. UnitedHealth Group’s OptumRx serves as the state’s pharmacy benefits manager for the entire Medicaid program.

Medicaid enrollment in Tennessee has grown 6.7% since January 2020, largely due to the impact of the COVID-19 pandemic. Virtually all of Tennessee’s Medicaid population is served by one of three contracted insurers: Anthem, Inc.’s Amerigroup unit, BlueCross BlueShield of Tennessee and UnitedHealthcare.

Cigna Corp. is the fifth-largest health insurer in the U.S., serving more than 15 million lives nationwide. More than 80% of its members are enrolled in administrative services only (ASO) contracting arrangements. While Cigna largely covers employer groups, the insurer is working to expand its individual and Medicare Advantage (MA) business, bringing its Affordable Care Act exchange plans to 79 new counties in 2021 while also expanding its MA reach to 80 new counties for the 2021 plan year. The push to expand into these markets may be partially fueled by the nationwide job losses caused by the COVID-19 pandemic, as Cigna's overall membership is down 8.7% from 4Q19.

Payers and manufacturers continue to exhibit broad interest in executing value-based pharmaceutical pricing agreements. But multiple factors — some of them amplified by the coronavirus pandemic — could pose challenges for those agreements as the health care industry tries to shake off effects of the pandemic and get back to more normal business, industry stakeholders say.

As drug prices remain on an upward trajectory, many copayment assistance programs offered by pharmaceutical companies have helped patients — particularly those on costly specialty medications — stay adherent to their treatment regimens. But many payers have pushed back against these programs, contending that the offerings undermine their benefit designs. Copay accumulator and maximizer programs operated by payers are the latest attempt to circumvent the manufacturer assistance, and they are growing in popularity. Manufacturers should be tracking them to see how their therapies, as well as their patient-assistance programs, are impacted by these tactics.

Centene Corp. celebrated the end of 2020 by closing on its acquisition of specialty pharmacy PANTHERx Rare, LLC on Dec. 30, then started 2021 with an agreement to acquire Magellan Health, Inc. The deals will strengthen Centene’s expertise in the specialty pharmacy space, particularly in the burgeoning orphan drug arena, by bringing onboard PANTHERx, an experienced company that’s shown remarkable growth over the past 10 years.

In addition to creating “one of the nation’s largest behavioral health platforms,” Centene Corp. will add another pharmacy-related asset to its portfolio with its recently announced $2.2 billion proposed purchase of Magellan Health, Inc.

In the year ahead, Trump administration drug pricing policies are likely to be changed or revoked by the Biden administration and court challenges, although which policies will be affected — and to what extent — is still unclear, policy experts tell AIS Health.

Centene Corp. on Jan. 5 said it agreed to acquire Magellan Health, one of the largest independently held providers of behavioral health services in the U.S. Magellan is currently contracted to serve 19 payer clients (see the top three below), which enroll about 16.5 million medical lives overall, according to the latest update to AIS’s Directory of Health Plans. Centene owns the fifth-largest behavioral health organization (BHO) in the national payer landscape, Cenpatico, and is also affiliated with Managed Health Network, a BHO inherited from Centene’s 2016 acquisition of Health Net. Centene is also set to acquire Magellan’s wholly owned PBM, Magellan Rx Management. Magellan currently serves 5.5 million pharmacy lives, while Centene’s PBM subsidiary Envolve Pharmacy Solutions has 6.1 million lives as of MMIT’s third-quarter 2020 lives data update.