Author: Amy Beal, PharmD – Pharmacy Services Director
It doesn’t surprise anyone who lives in the employee benefit world that over the past decade (2011-2021) the cost of “Specialty” drugs has increased 28%. Additionally, 55% of total medication spending in 2021 was in the Specialty drug class. With these numbers in mind, it’s more important than ever to have a Pharmacy Benefits Manager (PBM) that has an effective Specialty drug strategy that includes a clinically based and aggressive biosimilar program.
First things first: What are Specialty drugs and why is coverage important?
Specialty medicines are categorized in part by their high cost, but also can be classified as Specialty due to their use in treating rare diseases, limited distribution requirements, or because of the higher level of patient monitoring that is involved in their use. Growth in Specialty drug use is being driven primarily by autoimmune diseases and oncology. Psoriatic conditions, rheumatologic diseases, and inflammatory bowel disease make up a significant portion of the autoimmune market. Specialty drugs are important because they manage serious symptoms of serious diseases that, if left untreated, would significantly reduce the quality of life, or even debilitate many employees. Scripius is committed to encouraging our health plan and employer clients to provide coverage for these drugs so employees and their dependents have appropriate treatment for their chronic or acute conditions.
Proper price monitoring and management is one key to keeping Specialty drug costs under control.
Multiple factors have driven the increase in Specialty drug cost, including price increases for existing drugs, approvals of new Specialty drugs, and new indications for existing treatments which have expanded the eligible patient population. Scripius places self-administered specialty drugs in their own high coverage tier under the prescription drug benefit. This strategy creates higher out-of-pocket costs for employees and dependents who take Specialty medications, helping to ensure that only those who truly need these expensive medications use them. Additionally, Scripius employs Utilization Management (UM) processes such as Step Therapy (ST) and Preauthorization to ensure lower cost medications are tried before moving to higher cost therapies.
It’s important to have a PBM that is familiar with how medical benefits are used to pay for Specialty medications.
Scripius is part of a group of companies that include an integrated health plan (Select Health, which has over 1 million members nationwide) and a hospital and provider delivery system (Intermountain Health, which services seven states in the Intermountain West). In examining Specialty drug spend over the past decade, data shows Specialty drugs that are administered by healthcare professionals are often covered by a health plan’s medical benefit, instead of the prescription drug benefit. Because Scripius is integrated with both a health plan and a delivery system, we have strategies in place to monitor and control this aspect of Specialty drug spend as well. We have a team of clinical pharmacists who actively monitor new drug approvals, new indications, and pricing fluctuations and connect with in-network doctors to ensure the most effective and best priced medication is used for specific conditions.
Connecting to optimal cancer treatment and other disease pipelines.
Oncology continues to be a growth driver with research focusing on new pathways. Some of the oncology drugs in the pipeline for approval in 2022 include checkpoint inhibitors such as PD-1, CTLA-4, and PD-L1 inhibitors. Enzyme inhibitors also play a role in this category with Tyrosine Kinase (TKI) and poly ADP Ribose Polymerase (PARP) inhibitors leading the pack. Immunotherapies including Chimeric Antigen Receptor (CAR) T cell therapies target diseases such as Acute Lymphoblastic Leukemia (ALL), Non-Hodgkin Lymphoma (NHL), and Multiple Myeloma (MM), with pipeline treatments that are in clinical trials for multiple sclerosis, myasthenia gravis, and graft-versus-host disease. Gene therapy has entered the market in rare diseases such as Spinal Muscular Atrophy (SMA) and beta thalassemia and is expected to be a major cost driver with therapies in more common diseases under investigation including coronary artery disease, diabetic retinopathy, degenerative joint disease, Parkinson’s disease and HIV.
Your PBM should have an aggressive and well-managed biosimilars program, including a specific 2023 strategy for adalimumab.
It is estimated that over the next five years Specialty medication costs will see growth of 12% per year on a volume basis, with $130 billion dollars in cost in the US by 2025. Biosimilars present an opportunity to offset some of the expected growth in spend on pharmaceuticals in the U.S. Currently, eight biosimilar products are FDA approved and marketed with dozens waiting for FDA approval in the next year. Eleven biosimilar adalimumab (Humira) products are expected to be approved or commercially launched in 2023. Humira has been one of the top grossing drugs in the U.S. for several years with 2021 sales reaching $33 billion. It will be key that your PBM has a strategy for the effective use of these biosimilars when they come to market. The cost savings due to biosimilar competition is expected to offset some of the additional cost generated by new-to-market products over the coming years and you need a PBM who is prepared to implement the right strategies.
Anticipation and quick market reaction.
As new products are approved and come to market, Scripius’ clinical pharmacy team is dedicated to maintaining a clinically comprehensive formulary that can quickly adapt to new advances and simultaneously contain costs. Because we have a network of key opinion leaders from our integrated health plan, and an integrated delivery system, Scripius is uniquely agile, and can ensure that patients and members have access to the medications they need under guideline-based criteria, while controlling costs. Because we are integrated with a health plan and a delivery system, we have seen it all and are expertly positioned to serve health plans and other payers in a way our competitors can’t. We will work hard for your health plan and your company to innovate specific Specialty solutions. Let us show you how Scripius can interface with payers to create better outcomes and improve member satisfaction. For more information check out Scripius.org or email MakeTheSwitch@Scripius.org.