There are many challenges that manufacturers face when launching a new drug: Will physicians prescribe the drug? Will they have any legal issues? Will patients request the drug? How should they market and distribute it?
The list goes on and on, but one of the most critical questions to answer is this: Will patients be able to access the drug? A manufacturer can have all other elements of a product launch accounted for, but if there are tight restrictions in place then the launch team’s efforts will be in vain.
The very first restriction that manufacturers will run into at launch is having a coverage block put on their new therapy. The cost of life-saving therapies has led many payers to block coverage completely for new drugs. The coverage block gives payers time to assess the cost effectiveness of the product and decide how they want to manage the drug. While it depends on the payer and line of business, this process could take up to 12 months.
Imagine a new curative treatment coming to market, but patients can’t access it for a year! The good news is that many payers will allow the drug to be covered via the medical exception process. But to see success, pharma companies need to know how a payer’s medical exception process works and how likely a drug will be accepted in the process.
What the medical exception process looks like
The medical exception process is typically initiated when a physician recommends a newly launched drug and the patient finds out that insurance will not cover it due to the coverage block. From there, the physician or practice manager initiates the medical exception and makes the case for why the patient needs the drug and why the payer should cover it.
There are two key factors that determine the likelihood of being granted a medical exception. The first factor is the competitive landscape. How many comparative drugs are already on the market? What’s the availability of generics or biosimilars?
Similarly, the severity of the disease plays a huge role in the outcome of a medical exception. Many payers will refuse to cover a new drug if there are other drugs available. This can be true even if the currently available drugs have a different mechanism of action or slightly less efficacy, although if a new drug is significantly more efficacious or has less toxicity, then it is more likely be approved over a current drug.
In terms of timing, a medical exception is usually approved very quickly—typically within three days—but will vary by payer. In most cases, once a patient has a medical exception approved, it will last until the payer makes a broad coverage decision. This means that the patient will not have to go through the process multiple times.
How likely a drug will be eligible for a medical exception
Many factors need to be taken into account to understand the likelihood of a drug being covered under the medical benefit. The most important attributes are being first to market or treating a life-threatening disease. Other factors include what therapeutic area the drug is indicated for, line of therapy, if competitors are contracting in the space, the new drug’s efficacy and safety, and the strength of recommendation from prescribers.
While the medical exception process is not a guarantee, it’s critical for helping patients access many of the newly launched lifesaving drugs on the market. Pharma companies that understand how the medical exception process works and the likelihood of eligibility are better equipped to set accurate coverage expectations at launch and adjust their resources and forecasts accordingly.
As with most things in the world of market access, removing barriers starts with understanding them.
Need help understanding your likelihood of getting a medical exception and how to improve your chances at approval? Learn more about MMIT’s Strategic Launch Report.
By Seamus Cole, Associate Consultant, Advisory Services