Product Release

Radar On Market Access: As Cystic Fibrosis Costs Rise, Payers Seek New Strategies

February 26, 2019

Payers typically use tools such as prior authorization and utilization review to manage cystic fibrosis treatments, but PBM experts say they are on the cusp of implementing more innovative strategies that might help to improve adherence while addressing the cost of cystic fibrosis drugs, AIS Health reported.

Payers typically use tools such as prior authorization and utilization review to manage cystic fibrosis treatments, but PBM experts say they are on the cusp of implementing more innovative strategies that might help to improve adherence while addressing the cost of cystic fibrosis drugs, AIS Health reported.

Cystic fibrosis, an inherited chronic disease that attacks the lungs and digestive organs, is caused by mutations in the cystic fibrosis transmembrane conductance regulator (CFTR) gene. CFTR modulators and other therapies carry a high price tag, typically costing $250,000 to $368,000 per year. Other drugs, most of which do not have generic equivalents, can add tens of thousands of dollars to that total.

The majority of payers use traditional strategies, including pipeline monitoring, pharmacy and therapeutics committee drug review for formulary positioning, and prior authorization to confirm both the diagnosis and the presence of the specific genetic mutation targeted by the cystic fibrosis drugs, says Lynn Nishida, vice president of clinical product at Boston-based WithMe Health.

Still, “a growing number of payers are looking for out-of-the-box solutions for additional strategies in managing these drugs,” Nishida says. Cystic fibrosis drugs typically receive orphan drug status, which means payers cover them because they’re the only option for patients, but it can also mean they’re associated with higher costs, she says.

Payers expect multiple new drugs for cystic fibrosis over the next few years. Among products in the pipeline are more than a dozen agents aimed at restoring CFTR function, five products for clearing mucus, four anti-inflammatories, eight anti-infectives and one nutritional agent.

Managing infections in cystic fibrosis patients is a priority, says Mesfin Tegenu, R.Ph., president of PerformRx. However, effective antibiotics are also a main driver of cost.

Adherence to cystic fibrosis medications can be a challenge to manage, with studies showing a total reported mean adherence rate of 48% and a large drop-off in adherence in the adolescent years.

Nishida says that deploying one-on-one disease management/case management to closely monitor patients can make a significant difference, and might lead to savings in drug costs.

Trends That Matter for M&A Activity in Specialty Pharmacy and Infusion Therapy Spaces

February 14, 2019

The specialty pharmacy and infusion therapy spaces have certainly seen their share of merger and acquisition (M&A) activity over the years. Some challenges within those industries may have helped slow down 2018 activity a bit, observes Reg Blackburn, managing director at The Braff Group. And for 2019, we may see more of the same, AIS Health reported.

The specialty pharmacy and infusion therapy spaces have certainly seen their share of merger and acquisition (M&A) activity over the years. Some challenges within those industries may have helped slow down 2018 activity a bit, observes Reg Blackburn, managing director at The Braff Group. And for 2019, we may see more of the same, AIS Health reported.

As far as specialty pharmacy trends in 2018, Blackburn points out that “the largest specialty pharmacies continue to get even larger. Payer- and chain-owned dominate. Most new entity growth is coming from large academic hospitals starting their own specialty pharmacies.”

Direct and indirect remuneration (DIR) fees in Medicare Part D that include rebates and price concessions occurring after the point of sale have been around since the start of that program more than a decade ago.

But they started really becoming an issue for specialty drugs around 2016, and it doesn’t look like that’s changing any time soon.

Within the specialty pharmacy space, M&A activity “was lower than in past years,” he explains. Through third-quarter 2018, The Braff Group recorded eight specialty pharmacy deals, compared with 18 for full-year 2017, 20 for 2016 and 10 for 2015.

Moving forward into 2019, Blackburn expects to see “continued consolidation at a measured pace.” In addition, he says, “smaller independents will remain under pressure for gross margin and closed networks. They will want to exit, but buyers will be limited.”

Within the infusion therapy space over the past year, observes Blackburn, intravenous immune globulin and other specialty infusion products continue to drive revenue growth.

Radar On Market Access: Novel Drugs, High Prices, Ways to Manage Them Remain Hot

February 14, 2019

With the FDA approving multiple novel new therapies over the past couple of years, we should expect to see more of the same moving forward. But that innovation is not cheap, and the pharmaceutical industry likely will continue to offer products at higher price points than ever before, AIS Health reported.

With the FDA approving multiple novel new therapies over the past couple of years, we should expect to see more of the same moving forward. But that innovation is not cheap, and the pharmaceutical industry likely will continue to offer products at higher price points than ever before, AIS Health reported.

As payers struggle to rein in high specialty drug prices, many have turned to copay accumulator programs, and this trend shows no signs of slowing. “There was an increased focus on copay accumulator programs in 2018,” comments Amy Nash, Pharm.D., president of RelianceRx, the specialty pharmacy affiliate of Independent Health. She tells AIS Health she expects to see “further refinement of copay accumulator programs from payers and additional strategies from pharma to prevent them.”

Moving forward, Nash tells AIS Health, “specialty drug price increases will likely continue to be less frequent and at a lower percentage increase than previous years. We will likely see newly approved products priced lower than competitors to drive utilization.”

The industry could see “a handful of novel gene therapies with curative intent,” says Mesfin Tegenu, president of PerformRx. However, as the prices of these drugs and other innovative treatments continue to grow, “The high prices will necessitate a paradigm shift in the way medicines are paid for….Unsustainable price increases [are] forcing new payment models and novel cost controls.”

“Gene therapies may experience the biggest paradigm shift we will see in the near future,” says Jeremy Schafer, Pharm.D., senior vice president, director, payer access solutions at Precision for Value.

In the oncology space, the FDA last year approved the second tissue-agnostic drug: Loxo Oncology, Inc. and Bayer Corp.’s Vitrakvi (larotrectinib).

In 2019, Tegenu tells AIS Health, “We may see many new agents with new mechanisms of action, particularly site-agnostic chemotherapeutic agents….Cancer continues to be the most targeted therapeutic area of focus in terms of drug development.”

Radar On Market Access: Biosimilars Market Is Picking Up Steam, Could See Boom Soon

February 7, 2019

Biosimilars are one way that payers had hoped to bring down spending on pharmaceuticals, but as of yet, these products have had little impact in the United States. As of mid-January, the FDA had approved 17 biosimilars, but only a handful actually are available in the U.S. However, the products may pick up more traction in 2019, with some significant ones potentially coming to market, AIS Health reported.

Biosimilars are one way that payers had hoped to bring down spending on pharmaceuticals, but as of yet, these products have had little impact in the United States. As of mid-January, the FDA had approved 17 biosimilars, but only a handful actually are available in the U.S. However, the products may pick up more traction in 2019, with some significant ones potentially coming to market, AIS Health reported.

According to Lynn Nishida, R.Ph., vice president of clinical product at WithMe Health, “More biosimilars are in the pipeline, but, sadly, expect continued issues of patent litigations that delay marketing of biosimilars soon after their approval or force biosimilar manufacturers to consider launching products at risk” before a lawsuit has been settled, potentially setting themselves up to be responsible for paying damages if they lose the case.

“Biosimilars will face continued slow uptake in utilization; however, there will likely be additional biosimilar approvals with future potential for utilization,” says Amy Nash, Pharm.D., president of RelianceRx, the specialty pharmacy affiliate of Independent Health. “Oncology-related biosimilars will likely have increased utilization.”

Mesfin Tegenu, president of PerformRx, tells AIS Health that he expects “a slow but steady increase in the availability of marketed biosimilars.” Among the biosimilars his company is watching in 2019 are the following:

• Cyltezo (adalimumab-adbm) from Boehringer Ingelheim Pharmaceuticals, Inc.

• Erelzi (etanercept-szzs) from Sandoz Inc.

• Herzuma (trastuzumab-pkrb) from Celltrion Inc.

• Mvasi (bevacizumab-awwb) from Amgen

• Two biosimilar Neupogens (filgrastim)

“I think some doom-and-gloom statements about biosimilars were a bit premature,” Jeremy Schafer, Pharm.D., senior vice president, director, payer access solutions at Precision for Value, says. “Biosimilars have definitely had a challenging market entry, but we need to remember we are still in the early days of a very new industry. In addition, signs indicate that biosimilars in important categories are gaining more traction, and I expect them to continue to do so.”

Radar On Market Access: Specialty Drug Pipeline Holds Promise Amid High Costs

January 24, 2019

Blockbuster pharmaceuticals scheduled for launch in 2019 are expected to have a significant impact in treating certain cancers, spinal muscular atrophy, inflammatory conditions and some mental illnesses, according to Express Scripts Holding Co. With specialty medications managed through the pharmacy benefit now accounting for 41% of health plans’ total pharmacy spend, the PBM asserts it is crucial for plans to understand the product pipeline and create strategies to manage new, costly drug therapies, AIS Health reported.

Blockbuster pharmaceuticals scheduled for launch in 2019 are expected to have a significant impact in treating certain cancers, spinal muscular atrophy, inflammatory conditions and some mental illnesses, according to Express Scripts Holding Co. With specialty medications managed through the pharmacy benefit now accounting for 41% of health plans’ total pharmacy spend, the PBM asserts it is crucial for plans to understand the product pipeline and create strategies to manage new, costly drug therapies, AIS Health reported.

On the new drug front, Prime Therapeutics, in its December 2018 monthly update on the specialty pipeline, cites an annual wholesale acquisition cost (WAC) of $203,100 for Pfizer’s Daurismo (glasdegib), an oral drug approved by the FDA in combination with intravenous low-dose cytarabine to treat newly diagnosed acute myeloid leukemia in elderly and certain other adult patients. The Blues-affiliated PBM also points out that Loxo Oncology’s Vitrakvi (larotrectinib), approved by the FDA to treat adult and pediatric patients with certain solid tumors, has an average annual WAC for an adult patient of $393,600.

On the plus side for payers, Express Scripts notes some major drugs are coming off patent protection this year. This means, through the end of 2019, there is also opportunity for several blockbuster medications, including Advair Diskus, EpiPen and Lyrica, to face first-time generic competition.

Moreover, Express Scripts spokesperson Jennifer Luddy says, “We believe there is a $54.4 billion saving opportunity between 2017 and 2022 if [a dozen] biosimilars come to market when the originator patents expire.”

In a recent blog post, Express Scripts singled out two specialty drugs to watch in 2019:

(1) AVXS-101, a DNA-based gene therapy that delivers a functional copy of a human survival motor neuron 1 (SMN1) gene to treat children with spinal muscular atrophy (SMA) Type 1. It is expected to cost between $1 million and $3 million for the one-time IV infusion. The FDA action date is June 18, 2019, but early approval is expected, the PBM says.

(2) Tafamidis meglumine, which is expected to be the first drug approved for the treatment of cardiomyopathy caused by transthyretin-mediated amyloidosis. The drug’s approval is expected in mid-2019, and Express Scripts says it “could rapidly become the standard-of-care for these patients.”

Many pharmaceutical launches this year will treat a variety of cancers, with cancer therapies representing about one-third of all specialty drugs in the pipeline.

Trends That Matter for FDA Orphan Label Application Reviews

January 17, 2019

The Orphan Drug Act (ODA) offers multiple incentives to manufacturers that bring a drug to market with an orphan designation. A recently released U.S. Government Accountability Office (GAO) report revealed that while the number of applications both received and granted for this designation has grown, FDA reviewers were not consistently recording or evaluating required information that is mandated to consider granting this designation, AIS Health reported.

The Orphan Drug Act (ODA) offers multiple incentives to manufacturers that bring a drug to market with an orphan designation. A recently released U.S. Government Accountability Office (GAO) report revealed that while the number of applications both received and granted for this designation has grown, FDA reviewers were not consistently recording or evaluating required information that is mandated to consider granting this designation, AIS Health reported.

The report, titled Orphan Drugs: FDA Could Improve Designation Review Consistency; Rare Disease Drug Development Challenges Continue (GAO-19-83), shows that from 2008 to 2017, both orphan designation applications received as well as orphan designations granted rose.

Researchers also assessed whether FDA reviewers were using consistent criteria to evaluate applications. On this, however, reviewers’ performance left a bit to be desired.

From October to December 2017, after the implementation of the modernization plan, the agency analyzed 148 review templates. According to the GAO report, “of the five review template sections where reviewers are required to record information, we found that OOPD [i.e., the Office of Orphan Products Development] does not ensure that all required information is consistently recorded in the background information section and evaluated when making designation decisions.”

Of the 148 templates, the FDA granted orphan designation to 26 applications that were missing required information. GAO recommends that the “FDA should ensure that all required information for reviews of orphan designation applications is consistently recorded and evaluated. The agency concurred with our recommendation.”