New Organization Will Focus on Medical Benefit Drugs

A group of Blue Cross and Blue Shield-affiliated companies recently unveiled a new medication contracting organization focused on medical benefit drugs. The new company, known as Synergie Medication Collective, will be successful in improving the affordability of these treatments and patients’ access to them, an industry expert says, but it also will need to show that patients are seeing those savings.

Unveiled Jan. 5, the company says it “is focused on improving affordability and access to costly medical benefit drugs — ones that are injected or infused by a health care professional in a clinical setting — for nearly 100 million Americans.” It will focus not only on infusible treatments for conditions such as cancer but also on multimillion dollar gene therapies. The company says its goal is to “significantly reduce medical benefit drug costs by establishing a more efficient contracting model based upon its collective reach and engagement with pharmaceutical manufacturers and other industry stakeholders.” It plans to “bring to market several new product offerings” this year, among them “transformative value-based models.”

Synergie named Jarrod Henshaw, who previously served as chief innovation officer and chief supply chain officer for Prime Therapeutics LLC, as its CEO. Kim Keck, president and CEO of the Blue Cross Blue Shield Association, is the company’s initial board chair.

“The costs of medications continue to rise and are unsustainable, especially when it comes to medicines that treat rare and complex diseases,” said Keck in a press release. “We’re proud to help launch Synergie to tackle medication affordability and access. We believe there is a better way to do business — and this first-of-its-kind approach will have a positive impact for millions of people across the United States.”

In a report released in April 2022, the IQVIA Institute for Human Data Science revealed that specialty drugs accounted for 56% of spending in 2021, compared with 28% in 2011, with much of that driven by growth in the autoimmune and oncology classes. Spending within the autoimmune category rose 459% during that decade, while spending on oncolytics rose 226%. The per-person specialty medication spend also rose during that same time frame from $300 to $673, found the report, titled The Use of Medicines in the U.S. 2022: Usage and Spending Trends and Outlook to 2026.

By 2026, estimated the report, the total net spending on drugs will be more than $450 billion, up from $407 billion in 2021. The Institute also projected that innovative specialty therapies will continue to dominate drug launches, with an average of 50 to 55 new entities launching annually through 2026.

Synergie’s founding investors and initial clients are all Blues plans or companies affiliated with them:

  • Blue Cross Blue Shield Association, which consists of 34 Blues companies;
  • Elevance Health, Inc., the insurer previously known as Anthem;
  • Evio Pharmacy Solutions, which was founded by Blue Cross Blue Shield of Massachusetts, Blue Cross Blue Shield of Michigan, Blue Shield of California, Highmark Inc. and Independence Blue Cross;
  • Prime Therapeutics, including Magellan Rx Management as part of Prime, which is owned by 19 Blues plans, subsidiaries or affiliates of those plans; and
  • Independent health plans serving members in communities across the country: Blue Cross Blue Shield of Arizona, Arkansas Blue Cross Blue Shield, CareFirst BlueCross BlueShield, Blue Cross of Idaho, Blue Cross Blue Shield of Kansas City, Premera Blue Cross, Blue Cross Blue Shield of South Carolina, Blue Cross Blue Shield of Vermont and Wellmark Blue Cross Blue Shield.

“Medications covered under the medical benefit are some of the fastest growing segments of overall drug spend with the most challenges for effective cost management,” Henshaw says via email. “Trends in high-cost therapies (e.g., multimillion dollar gene therapies and infusible cancer drugs) present challenges to affordability and access to care. Synergie was formed to tackle these tough issues and radically improve affordability and access to these costly medications.”

“This is the formation of a large negotiation organization for specialty drugs — a good analog would be a ‘PBM-equivalent’ for medical benefit drugs with the goal of reducing the cost of these,” observes Lisa Kennedy, Ph.D., chief economist at Innopiphany, LLC. “Oncology and specialty drugs for rare disease are areas that both payers and self-insured employers are looking to actively manage as they see more and more use of stop-loss insurance for cancer and rare disease patients.”

The organization’s “express goal,” she says, is “reducing the costs of specialty drugs through broader negotiation, shared systems, data and other tools.”

Henshaw clarifies that the organization will not be administering any utilization management, “but its offerings will have a correlation to appropriately aligned UM strategies in order to realize maximum affordability.”

He tells AIS Health, a division of MMIT, that “providers are a vital part of the value chain for how medications covered under the medical benefit are delivered to patients to ensure best available outcomes at an affordable cost. For this reason, it is likely that Synergie will seek to partner with providers, pharmaceutical manufacturers, health plans and other industry stakeholders as it develops most efficient value-based models to effectively manage emerging drug therapies.” It will not, however, contract with wholesalers and distributors.

When it comes to gene therapies, while they can be “life-saving,” they also “often come with multimillion dollar price tags that must be managed if we are to ensure sustained affordability and access,” says Henshaw. “Importantly, these new medications will require different management solutions to ensure sustained affordability and access. To be effective, cell and gene management solutions will need to be integrated across the stakeholder spectrum of payers, pharmaceutical manufacturers and providers. The traditional prescription drug management model will need to evolve to meet this need. That is the challenge we face, the need for new and better management solutions for emerging cell and gene therapies. Synergie aims to tackle this industry challenge, among other areas of focus.”

Asked about potential Synergie competitors, Kennedy replies that it “will likely compete with specialty pharmacies with the intent of being larger and offering more services than specialty pharmacies.”

According to Henshaw, “Synergie is a first-of-its-kind, in terms of its collective reach and business model. Our focus is to improve affordability and accessibility of drugs that are critically important to the health of millions of Americans under medical benefits. All savings opportunities created through Synergie will be passed on to the participating companies with the goal of improving affordability to costly specialty medications. Synergie’s goal is not to create profits for itself but rather to create and fully pass through meaningful savings opportunities to payers for the purpose of lowering costs.”

He adds that Synergie “will measure success based on affordability and innovation, at an accelerated pace. We must lower the cost of specialty medications for payers and consumers in the near term and focus on the best approaches to successfully manage the unique affordability challenges associated with the emerging medication pipeline.”

Kennedy tells AIS Health that she “definitely” expects the company will be effective in improving affordability and access to medical benefit drugs, “but the question is whether patients will pay less or if the savings will be absorbed by Synergie and the Blues.”

The new endeavor may face some challenges, though. “The optics around PBMs and the intense interest in these from the media, which has catalyzed close scrutiny by federal legislators, is something that this organization will need to avoid,” Kennedy says. “It is important that this organization can demonstrate that savings accrue to patients.”

Contact Henshaw via Mike Fay at and Kennedy at

© 2024 MMIT
Angela Maas

Angela Maas

Angela has an extensive background of editing, reporting and writing for trade and consumer publications. She has written Radar on Specialty Pharmacy since she joined AIS Health in 2005 and has broad knowledge of the various issues at play within the space. She also has written for Spotlight on Market Access since its 2017 launch. Before joining AIS Health, she was managing editor at Employee Benefit News and Employee Benefit News Canada and managing editor at Hem Aware (a hemophilia publication), Lupus Living and Momentum (a multiple sclerosis publication). She has a B.A. in English and an M.A. in British literature from Arizona State University.

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