Payer

Radar On Market Access: COVID-19 Pandemic May Change Rx Delivery Permanently

May 26, 2020

Industry experts expect the COVID-19 pandemic and related economic crisis, in addition to the trend of vertical integration in the PBM sector, will increase those companies’ direct interaction with consumers, AIS Health reported.

Industry experts expect the COVID-19 pandemic and related economic crisis, in addition to the trend of vertical integration in the PBM sector, will increase those companies’ direct interaction with consumers, AIS Health reported.

The recent wave of payer acquisitions of PBMs has kept the latter on strong footing despite the crisis. CVS Health Corp.’s Caremark, UnitedHealth Group’s OptumRx and Cigna Corp.’s Express Scripts control approximately 74% of the market, according to a January 2020 estimate by Drug Channels Institute CEO Adam Fein, Ph.D.

Fein said in a May 8 webinar that he expects the dominant PBMs’ bargaining clout, deepening synergies and cash reserves to drive more aggressive formulary management during the COVID-19 crisis.

Vertical integration has changed the revenue mix of large PBMs. According to Fein, rebates account for a declining amount of profits for the big three PBMs, and they are largely passed through to payer clients.

The vertical integration trend has also helped PBMs adapt to new consumer choices driven by COVID-19, according to Fein. “Mail pharmacies [had] a huge spike [in fills] into March, and right now, mail pharmacy growth has now flatlined again. Retail pharmacy has taken a very big hit. Once the lockdown started to go into effect, [retail] prescriptions started to decline because people couldn’t get to the retail pharmacy,” Fein said.

Still, he is skeptical about the durability and scale of the consumer shift away from retail toward mail order.

“[Mail order] gained a little, but it’s not some runaway shift in the market,” Fein explained, citing its still-small share of the overall prescription drug market. “The notion of a retail-to-mail shift — it’s going to happen, but it may not last too much longer. So for PBMs, it’s a short-term boost, but perhaps not a long-term shift.”

However, Mike Schneider, a principal at Avalere Health, says that he’s bullish on the trend toward mail order. Schneider says consumers with chronic conditions and long-term medications are likely to stick with mail-order fills — assuming they are still available after the pandemic ends. The key to continuing that trend, he adds, is whether seniors, the largest demographic group of prescription drug users, take a liking to the mail order system.

MMIT Reality Check on Low Testosterone (May 2020)

May 22, 2020

According to our recent payer coverage analysis for low testosterone treatments, combined with news from key healthcare influencers, market access is shifting in this drug landscape.

According to our recent payer coverage analysis for low testosterone treatments, combined with news from key healthcare influencers, market access is shifting in this drug landscape.

To help make sense of this new research, MMIT’s team of experts analyzes the data and summarizes the key findings for you. The following are brief highlights. To read the full piece, including payer coverage, drug competition and prescriber trends, click here.

Payer Coverage: A review of market access for low testosterone treatments shows that under the pharmacy benefit, about 58% of the lives under commercial formularies are covered with utilization management restrictions.

Trends: In February 2020, Clarus Therapeutics, Inc. said that its Jatenzo (testosterone undecanoate) is available by prescription in the U.S. In March 2019, the FDA approved the medication for the treatment of males with low testosterone levels because of specific genetic disorders or pituitary glanddamaging tumors.

Radar On Market Access: COVID-19 Pandemic Drives Home Infusion Utilization

May 21, 2020

With numerous hospitals focused on the COVID-19 pandemic and many areas under stay-at-home mandates, home infusion is more important than ever. Changes within the industry already have been seen, and the current situation is likely to result in permanent shifts within the home infusion space, AIS Health reported.

With numerous hospitals focused on the COVID-19 pandemic and many areas under stay-at-home mandates, home infusion is more important than ever. Changes within the industry already have been seen, and the current situation is likely to result in permanent shifts within the home infusion space, AIS Health reported.

“If you can do infusion at home, you need to do it there,” maintains Ashraf Shehata, KPMG national sector leader for Healthcare & Life Sciences. “This is about controlling infection risk in the near term, and many home infusion candidates are in a high-risk category. Longer term, there has been a shift toward delivering care in the most economical and clinically appropriate setting, largely driven by payers.”

“We have seen an increase in some home infusion utilization of select therapies in certain markets where patient administration sites of care are shifting from the acute care or hospital outpatient setting to the home, related to the pandemic,” says Drew Walk, CEO of Soleo Health.

Some plans already have been shifting administration of certain therapies to patient homes and provider offices, which are more cost-effective settings than hospitals, points out Elan Rubinstein, Pharm.D., EB Rubinstein Associates.

“There could be more home infusion, with drugs that pose low risk of serious adverse events during or immediately after infusion or where a patient tolerated prior infusions of these drugs with no or minimal difficulty,” says Rubinstein.

Lisa Kennedy, Ph.D., chief economist and managing principal at Innopiphany LLC, points out that while CMS has changed some policies in support of home infusion, “not everyone is on board.” She notes that the Community Oncology Alliance “has raised safety concerns about home infusion centered on a lack of training of those in the community administering treatment at home versus trained oncology nurses.”

“Going forward there will be a lot of candidates for home infusion, and some customers/patients may like the convenience of getting care at home,” says Shehata. “There might be opportunities for alternative care models to be introduced here. The ability for nurses to teach patients how to self-administer the medicines is an important facet to this.”

Radar On Market Access: PBMs See Solid 1Q Results Despite Challenges Ahead

May 19, 2020

Major PBMs reported strong results for the first quarter of 2020 as members rushed to fill prescriptions in March ahead of the COVID-19 pandemic. However, financial analysts warn the pandemic could have unpredictable effects on PBMs’ finances for the rest of 2020 and moving into 2021, AIS Health reported.

Major PBMs reported strong results for the first quarter of 2020 as members rushed to fill prescriptions in March ahead of the COVID-19 pandemic. However, financial analysts warn the pandemic could have unpredictable effects on PBMs’ finances for the rest of 2020 and moving into 2021, AIS Health reported.

The 2021 PBM selling season could be disrupted in still-unknown ways, analysts said, and members are cutting back on routine physician visits and elective procedures, resulting in lower script volume overall.

Anthem, Inc., posted a particularly strong start for its new IngenioRx PBM, with earnings of $349 million, well above the $275 million to $300 million quarterly earnings that had been expected.

The impact from COVID-19 included a large spike in prescription refills during March, which helped the PBM’s performance, Anthem Executive Vice President and CFO John Gallina said in the company’s earnings conference call. Still, investors shouldn’t expect script numbers to remain elevated, he added: “We have seen a slight drop in new scripts here in April over historical patterns.”

CVS Health Corp. reported first-quarter earnings per share (EPS) of $1.91, well above what analysts had anticipated. Citi analyst Ralph Giacobbe wrote in a May 6 investor note that the company’s Caremark PBM “put up solid results with revenue and operating profit also exceeding consensus with higher claims growth of 12.4%.” This was “aided by pull-forward of scripts due to COVID-19,” plus the partnership between CVS and Anthem on IngenioRx.

Cigna Corp.’s first-quarter adjusted EPS came in 8% above consensus, with better-than-anticipated performances in its Health Services unit, which houses PBM Express Scripts, and in its Integrated Medical segment. Health Services reported an operating profit of $1.08 billion, slightly ahead of expectations, with revenue well ahead of projections — $27.2 billion versus $25.1 billion expected, noted Giacobbe.

At UnitedHealth Group, earnings for Optum, the division that includes OptumRx, missed analysts’ expectations by about 5%, despite stronger-than-expected revenue, Jefferies equities analyst David Windley wrote in a note to investors. “OptumHealth and OptumRx both contributed to the underperformance,” which was offset by stronger-than-expected performance by OptumInsight, he said.

MMIT Reality Check on Pain Narcotic Opioid (May 2020)

May 15, 2020

According to our recent payer coverage analysis for pain narcotic opioid treatments, combined with news from key healthcare influencers, market access is shifting in this drug landscape.

According to our recent payer coverage analysis for pain narcotic opioid treatments, combined with news from key healthcare influencers, market access is shifting in this drug landscape.

To help make sense of this new research, MMIT’s team of experts analyzes the data and summarizes the key findings for you. The following are brief highlights. To read the full piece, including payer coverage, drug competition and prescriber trends, click here.

Payer Coverage: A review of market access for pain narcotic opioid treatments shows that under the pharmacy benefit, about 35% of the lives under commercial formularies are covered with utilization management restrictions.

Trends: Many brand name products (Xtampza ER, Oxaydo) continue to enter this market despite the numerous generics. Given assumed parity in efficacy among remaining name-brand products, contracting for position after a generic is common.

Perspectives on Coronavirus Antibody Testing

May 14, 2020

With the Trump administration anxious to “reopen” the U.S. economy and ease the social-distancing measures meant to slow the spread of COVID-19, officials have pointed to antibody testing as a critical tool to accomplish those goals. To that end, the administration on April 11 issued a document clarifying that most private health plans must cover such tests, which detect antibodies against the new coronavirus found in the blood of people who have been infected and now may be immune.

With the Trump administration anxious to “reopen” the U.S. economy and ease the social-distancing measures meant to slow the spread of COVID-19, officials have pointed to antibody testing as a critical tool to accomplish those goals. To that end, the administration on April 11 issued a document clarifying that most private health plans must cover such tests, which detect antibodies against the new coronavirus found in the blood of people who have been infected and now may be immune.

“It’s not exactly a surprise, [but] I don’t know that it was 100% expected,” Jason Karcher, a Milliman Inc. actuary, tells AIS Health regarding the requirement. “It seems like as much a point of clarification rather than a ‘hey, we’re going to require something totally out of the blue.'”

So far, at least serological tests have received an Emergency Use Authorization from the FDA.

Cost information is not as readily available for serological tests as it is for tests that diagnose COVID-19, which cost around $51 until CMS increased the reimbursement rate for “high-throughput” diagnostic tests to $100. Cellex, which makes one of the antibody tests that received emergency authorization by the FDA, did not respond to an inquiry about the price of its test as of press time, but Vox reported that “a serological test can be less than $10.”

William Schaffner, M.D., a professor of preventive medicine and infectious diseases at Vanderbilt University, says there are good reasons to temper expectations about how testing people for COVID-19 antibodies could help the U.S. reopen businesses, schools and events.

Since the FDA is essentially allowing companies to do their own evaluation of serological tests’ effectiveness, that will naturally invite questions about whether their results can be trusted, Schaffner says, suggesting that some tests may be more rigorously evaluated than others. “Then there’s the question of availability of the tests — we’ve been down this road once before, where people were told that the nasal swab test for the virus itself would be widely available, and anybody can have it who wants it,” he says. “Well, we’re still struggling with that, and we would like not to repeat that fiasco.”