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Radar On Market Access: Health Care Deals May Slow in 2020, but Government Markets Remain Hot

January 9, 2020

The pace of health care mergers and acquisitions likely will cool slightly in 2020, some industry experts tell AIS Health. Still, insurers are likely to seek out companies with assets such as care management or information technology solutions, while provider consolidation will continue in certain markets, AIS Health reported.

The pace of health care mergers and acquisitions likely will cool slightly in 2020, some industry experts tell AIS Health. Still, insurers are likely to seek out companies with assets such as care management or information technology solutions, while provider consolidation will continue in certain markets, AIS Health reported.

“We expect that payer M&A will continue into 2020, with a bias toward vertical rather than horizontal deals,” says Michael Abrams, managing partner of Numerof & Associates, Inc. “Payers will use such deals to expand into adjacent market spaces to differentiate their offerings as integrated platforms that can deliver superior value, customer experience and innovation.”

Joe Paduda, a principal with Health Strategy Associates, says he expects less M&A generally in 2020, for several reasons. “There aren’t as many assets to buy after the multiple deals done over the last few years; buyers are waiting to see results of the elections, which will drive their future strategy; and asset prices have edged even higher, making transactions more expensive and leaving less margin for error.”

Dan Mendelson, the founder of consulting firm Avalere Health, says he still sees plenty of potential targets for horizontal mergers, along with more targets for vertical deals.

“Health plans are in a transformative phase right now. There are three major areas of focus: government markets, care management, and the information technology needed to support quality improvement and cost reduction,” says Mendelson.

“In government markets, there are a range of quality assets that the larger plans could still acquire,” he adds. “There are also some non-profits that could engage in collaboration with for-profit organizations to expand their scope and reach.”

Medicare Advantage plans will be “a very strong target for M&A” in 2020, says Ashraf Shehata, KPMG’s national sector leader for health care and life sciences.

Shehata says he also expects insurers to “amass capabilities around their PBMs.” This, he says, could include bolstering their specialty pharmacy capabilities and building out technology.

Radar On Market Access: Navajo Nation, Molina Partner on Medicaid Managed Care in New Mexico

January 7, 2020

The business arm of the Navajo Nation plans to contract with Molina Healthcare, Inc., to offer Medicaid managed care as part of a partnership between New Mexico, tribal officials and the insurer, AIS Health reported.

The business arm of the Navajo Nation plans to contract with Molina Healthcare, Inc., to offer Medicaid managed care as part of a partnership between New Mexico, tribal officials and the insurer, AIS Health reported.

The program would be the first-ever Medicaid managed care program dedicated solely to the health care, cultural needs and geographic needs of native populations living in the Navajo Nation, according to Molina.

The new managed care plan — which Navajo Nation-owned Naat’aanii Development Corporation hopes to launch in 2020 — could cover up to 75,000 Navajos who live in New Mexico.
“This is very much led by the Navajo Nation,” says Sandeep Wadhwa, M.D., chief health officer and senior vice president of government programs for Solera Health.

The deal appears to be the first between a managed care company and an organization that is owned by a Native entity, Wadhwa, who is not affiliated with Molina, tells AIS Health. “There is a dimension of self-determination by the tribe and by American Indians that hadn’t been realized previously,” he says.

Under Medicaid, state-contracted managed care plans may be an option for American Indians and Alaska Natives, but this is the first time a tribal nation has contracted with a state Medicaid program, Wadhwa adds.

Approximately 100,000 Navajos live in New Mexico, and around three-quarters of them are eligible for Medicaid, according to the New Mexico Human Services Department (HSD). Navajos experience a heavy disease burden, with a mortality rate that’s 31% higher than the overall U.S. rate, HSD figures show.

If this arrangement with Molina and the Navajo Nation helps to improve health outcomes and reduce costs, there may be other tribes and tribal nations that consider similar initiatives, Wadhwa says.

MMIT Reality Check on Growth Hormone Deficiency (Jan 2020)

January 3, 2020

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

According to our recent payer coverage analysis for growth hormone deficiency 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 growth hormone deficiency treatments shows that under the pharmacy benefit, more than 63% of the lives under commercial formularies are covered with utilization management restrictions.

Trends: As more growth hormone products become available, payers have even more tactics available to them to manage this specialty class. In particular, payers can manage their unit costs for these therapies by contracting with manufacturers to prefer products.

Trends That Matter for New Acute Migraine Medications

January 2, 2020

New oral medications for acute migraine — one pending launch and two more that could be approved in the coming months — likely won’t shake up formulary coverage for a condition that’s largely treated by generic triptan medications, pharmacy benefit experts tell AIS Health.

New oral medications for acute migraine — one pending launch and two more that could be approved in the coming months — likely won’t shake up formulary coverage for a condition that’s largely treated by generic triptan medications, pharmacy benefit experts tell AIS Health.

Eli Lilly and Co. on Oct. 11 received FDA approval for its drug Reyvow (lasmiditan), an oral medication that’s the first serotonin (5-HT)1F receptor agonist to be approved for migraine. Meanwhile, Allergan on Nov. 19 said it’s on track for December FDA consideration of ubrogepant, an oral CGRP receptor antagonist for acute migraine. Biohaven Pharmaceuticals also has applied for FDA approval on its oral CGRP antagonist rimegepant.

Mesfin Tegenu, R.Ph., president of PerformRx, doesn’t expect widespread uptake of Reyvow. “The launch of lasmiditan will likely not change the formulary status quo when it hits the market, as it most likely will become a niche medication for patients inadequately controlled on triptans, or for those who cannot take triptans,” Tegenu tells AIS Health. “This is primarily due to warnings on the label for driving impairment and central nervous system depression.”

The graphics below show the current market access to acute migraine medications for all payers under the pharmacy benefit.

Radar On Market Access: New Sickle Cell Medications Offer Both Opportunities and Challenges

January 2, 2020

The first targeted therapy to treat pain crises in people with sickle cell disease presents a “welcome” new option that payers likely will embrace, a PBM head tells AIS Health. While the drug’s manufacturer cites “positive” early discussions with payers on it, some experts note the lifetime treatment — via a monthly intravenous infusion — is costly: around $100,000 annually.

The first targeted therapy to treat pain crises in people with sickle cell disease presents a “welcome” new option that payers likely will embrace, a PBM head tells AIS Health. While the drug’s manufacturer cites “positive” early discussions with payers on it, some experts note the lifetime treatment — via a monthly intravenous infusion — is costly: around $100,000 annually.

On Nov. 15, the FDA approved Novartis’ Adakveo (crizanlizumab-tmca), a treatment to fight the underlying cause and reduce the frequency of vaso-occlusive crisis, described as a common and painful complication of sickle cell disease. It is approved for patients ages 16 and older with the genetic blood disorder.

Hydroxyurea, a drug approved by the FDA in 1998, is now generic, costs about $1,000 a year, and is approved for children, the New York Times reported on Dec. 7. The two newcomers are Adakveo and Global Blood Therapeutics’ Oxbryta (voxelotor), a daily pill granted accelerated approval by the FDA 10 days after Adakveo’s approval. This led one expert to tell the news outlet that insurers likely will want to begin with hydroxyurea as the front-line therapy.

Yet Mesfin Tegenu, R.Ph., president of PerformRx, LLC, says that “options for patients with sickle cell disease have been very limited up to this point, so the approval of Adakveo is a welcome addition in the treatment of this debilitating disease.”

Eric Althoff, a Novartis spokesperson, says the company anticipates that health plans will see a value proposition with Adakveo. “Early discussions with payers are positive,” Althoff says. “In fact, a number of payers have already added Adakveo to medical policy including state Medicaid [programs].” Florida and Alabama’s Medicaid programs have agreed to cover Adakveo, Reuters reported on Dec. 20.