Analysis

Today’s guest post comes from Vizient™ University Health System Consortium, the nation's largest network of academic medical centers (AMCs) who collaborate to exchange and advance knowledge. Vizient is the nation's largest healthcare performance improvement company.

The five authors of this article are employees of Vizient AMC members. Four of the five are leaders and participants of the organization's Pharmacy Network and its Specialty Pharmacy Committee.

The authors argue that specialty pharmacy programs at health systems provide significant advantages to hospitals, health systems, and patients. They highlight the specific benefits for organ transplant and hepatitis C patients.

Read on for their interesting perspectives.

Yesterday, Walgreens Boots Alliance (WBA) reported its financial results for the fiscal quarter ending February 28, 2017.

The big news: Prescription activity spiked in Walgreens drugstores. It looks like Stefano Pessina, our global channels overlord and executive vice chairman and chief executive officer of WBA, has a solid strategy for winning U.S. prescription market share.

Back in November, I told The Wall Street Journal: “Walgreens is trying to be the best friend of every PBM that’s not named Caremark.” These latest results show that this aggressive partnering is paying off for its pharmacy business—although its front-end growth was weak and per-prescription profits appear to be down.

Read on for more details—and expect a competitive reaction.

The new 2016 Medical Pharmacy Trend Report (free download), from Magellan Rx Management, was released yesterday. As always, the report includes a boatload of useful data on medical benefit spending and claims. Click here to read the press release.

Unfortunately, the latest edition also shows how hospitals continue to earn outrageous profits on specialty drugs. Commercial payers still use reimbursement approaches that permit hospitals to inflate specialty drug costs by thousands of dollars per claim.

These hospital mark-ups translate directly into higher drug spending—regardless of how manufacturers set list prices. Using some fairly conservative assumptions about Remicade, I show below how hospitals are earning thousands of dollars more than the drug’s manufacturer does.

Meanwhile, health plans are struggling to shift patients from hospital outpatient settings to physician offices—where costs are lower, at least until those sites are acquired by hospitals.

I suppose that the charts below should be troubling to hospital-based physicians, who can barely control their righteous indignation over drug prices. Alas, it’s always easier to blame pharma companies than to admit that their own hospital employers are driving up healthcare costs.

PCMA PBM Policy Forum 2017
May 1, 2017 | The Newseum | Washington, DC

In this era of high drug prices and expensive specialty medicines, the role of pharmacy benefit managers (PBMs) has never been more important. PBMs provide employers, unions, public programs, physicians, and consumers with cost savings strategies and clinical services that are essential to the affordability and efficacy of prescription drugs.

Typically, PBMs reduce drug costs by 30 percent for more than 266 million Americans enrolled in private and public plans, most notably Medicare Part D.

PCMA's annual PBM Policy Forum brings together the private and public sector to deliver important insights into the prescription drug marketplace and to highlight the role of PBMs in managing prescription drug costs and improving health outcomes.

Confirmed speakers:

• Amy Bricker, Vice President, Supply Chain Strategy, Express Scripts
• Alex Brill, Research Fellow, American Enterprise Institute
• William Fleming, Segment President, Healthcare Services, Humana Inc.
• Doug Holtz-Eakin, President, American Action Forum
• Andrea Marks, Chief Analytics Officer, OptumRx
• Mark Merritt, President & Chief Executive Officer, PCMA
• Surya Singh, Executive Vice President & Chief Medical Officer, CVS/Specialty, CVS Heath
• Moderator: Susan Dentzer, President & Chief Executive Officer, Network for Excellence in Health Innovation

Who Should Attend?
The PCMA PBM Policy Forum is designed for policy makers and staff from Capitol Hill and the Administration, as well as healthcare and drug industry advocates from think tanks, patient advocacy groups, industry trade associations, and the media.

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The content of Sponsored Posts does not necessarily reflect the views of Pembroke Consulting, Inc., Drug Channels, or any of its employees.

Spring has finally reached Drug Channels' worldwide headquarters in lovely downtown Philadelphia! (See photo at right.) Before your allergies kick in, please enjoy this month’s selection of noteworthy news stories.

• What has Eli Lilly revealed about its gross-to-net discounts?

• Are CVS Health and Novo Nordisk starting to pop the gross-to-net bubble?

• Who will win the 2017 specialty pharmacy award?

Plus, we celebrate healthcare nonreform by revisiting an innovative infinite-deductible health plan.

P.S. Follow @DrugChannels for my daily curated selection of stories and articles from the drug channels multiverse.

Pharmaceutical manufacturers pay billions in rebates to pharmacy benefit managers (PBMs). These beastly rebates are the largest single component of the gap between a drug’s list price and the net price received by the manufacturer. But one question comes up every day in this little town: For specialty drugs, how much of that money do PBMs share with their plan sponsor clients?

To find out, let’s put the Pharmacy Benefit Management Institute’s (PBMI) new 2017 Trends in Specialty Drug Benefits Report to the test. (Free download after unnecessarily complicated registration process.) Drug Channels thanks Walgreens Specialty Pharmacy for having sponsored this enchanted research.

According to the PBMI’s survey data, many (but not all) employers receive a portion of manufacturer rebates for specialty drugs. Large employers are most likely to get the entire rebate amounts. Others get a share of the rebates or a flat guaranteed amount.

As more specialty drugs are launched, specialty therapeutic categories will become more crowded. Expect the value of manufacturer rebates for specialty drugs to grow and formulary exclusions to become more common. Manufacturers will face the same dilemma as our heroine Belle: Is it possible to love someone who is holding you captive?

World Congress Manufacturers’ 340B Summit
May 16-17, 2017 | Philadelphia

Join pharmaceutical manufacturers, thought leaders, and leading regulatory strategists at the World Congress Manufacturers’ 340B Summit, May 16-17, in Philadelphia. This event will dive deep into the strategic, operational, legal and regulatory implications to pharma manufacturers of the evolving health care landscape around 340B.

Through high-level discussion:

• Create strategies for managing pricing calculations and average ceiling prices
• Overcome operational challenges to better align refund strategies
• Improve self-disclosure reporting while building better relationships with covered entity
• Gain legal insights and considerations around 340B to better prepare for the changing landscape
• Review trends, findings and preparation strategies for increased HRSA audits

Confirmed speakers include executives from Pfizer, J&J, BMS, Fresenius Medical Care, Hogan Lovells, King & Spalding, Sidley, State of Oregon, University of Chicago, NACDS.

To learn more or register for this event, visit here. Rates start at $995 for pharmaceutical manufacturers. Drug Channels readers can use discount code DC200 to save $200!

This event, co-located with the 2nd Annual Covered Entities’ 340B Summit, provides comprehensive coverage of the 340B program.

CPE Credits and CLE Credits* are available.

*CLE Pending approval

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The content of Sponsored Posts does not necessarily reflect the views of Pembroke Consulting, Inc., Drug Channels, or any of its employees.

Today’s guest post comes from Christian Herrington, Corporate Vice President Pharmacy Strategies for H.D. Smith.

Christian addresses five frequently asked questions for pharmacy owners who are considering selling their pharmacy. To help independent pharmacies both navigate and direct the sales process, H. D. Smith created VentureRx.

VentureRx fully supports the sale, purchase, start-up and transition strategies of pharmacies. Click here for a free, no-obligations needs assessment from VentureRx.

Read on for Christian’s insights.

Four of the largest pharmacy benefit managers (PBMs)—CVS Health, Express Scripts, MedImpact, and Prime Therapeutics—have raised their swords and released their 2016 drug trend reports. (Links below.) That means it’s time for some Drug Channels-style fun! Below, I review what the reports reveal about drug spending—and which questions remain unanswered.

Drug trend measures the year-over-year changes in a plan sponsor’s pharmacy benefit drug spending. As you will see, all four PBMs reported that their drug trend percentages for 2016 were in low single digits. The unweighted average among them was a mere 3.5%. About one-third of PBM clients experienced year-over-year declines in drug spending.

Put more simply: The U.S. doesn’t have a drug spending problem. It's fake news.

Specialty drugs have doubled as a share of plan sponsors’ benefit costs. Since these products account for only about 1% of claims, pharmacy benefit management is increasingly focused on handling these patients and their complex, hard-to-treat diseases. Unfortunately, payers seem set on discriminating against people who receive these therapies.

Keep in mind that the PBMs’ reports are primarily marketing documents, not peer-reviewed research studies. But as many PBM executives have said: What we do in life echoes in eternity!

CBI’s Real-Time Benefit Check and ePrior Authorization Summit
May 23-24, 2017 | Philadelphia, PA
www.cbinet.com/benefit-check

CBI's Real-Time Benefit Check & ePrior Authorization Summit is headed back to the East Coast this May.

Mark your calendar and benefit from this highly focused conference that's on the pulse of groundbreaking advancements in real-time benefit verification and prior authorizations. Industry pioneers from bio/pharma, PBMs, plans, pharmacies, health systems, prescribers and system solution providers will discuss the latest in standards, adoption and best practices to ensure streamlined prescriber workflow and faster access to medication for patients.

Featured Sessions Include:

• Regulatory/Legislative Update - Gain Real-Time Updates on State and Federal Legislative Advancements
• NCPDP Update - Advancements and Standards for Adoption
• Transcending to Higher Efficiency and Patient Access – A Vision and Reflection on Breakthroughs in Integrated ePA Functionality and Real-Time Determinations
• Implementation Best Practices – Showcasing Trailblazing Efforts and Pilots to Date
• Health System Perspectives on Patient Portal Implementation
• Integrating ePrior Authorizations and Benefit Determinations into the HUB Service Model
• Ensuring Continuity of Care and Addressing PA Renewals
• New Frontiers in Formulary Data Management and Prior Authorization Processes

Confirmed Speakers:

• Lynnae M. Mahaney BSPharm, MBA, FASHP, Center for Pharmacy Practice Accreditation
• Nicole Russell, Manager of Government Affairs, NCPDP
• Sam Garas, RPh MSc, Director-Medical Outcomes Specialist- National Specialty Accounts, North America Medical Affairs, Pfizer, Inc.
• John Klimek, R.Ph. Senior Vice President, Standards and Industry Information Technology, NCPDP
• Catherine C. Graeff, R.Ph, MBA, Principal, Sonora Advisory Group; NCPDP Work Group
• Shelly Spiro, Executive Director, Pharmacy HIT Collaborative
• Tyler Scheid, Senior Policy Analyst, Administrative Simplification Initiatives, American Medical Association
• Robert Sanchez, Senior Director for Enterprise Product Innovation, CVS Health
• Michele Davidson, Senior Manager, Pharmacy Technical Standards, Development & Policy, Government Relations, Walgreen Co.
• Joel White, Founder and President, Horizon Government Affairs

Be among the first to see the complete agenda by visiting here, or check out www.cbinet.com/benefit-check for further details and to register. Drug Channels readers will save $400 off of the standard registration rate when they use discount code HYE399.*

*Cannot be combined with other offers or used towards a current registration. Cannot be combined with special category rate or non-profit rates. Other restrictions may apply.

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The content of Sponsored Posts does not necessarily reflect the views of Pembroke Consulting, Inc., Drug Channels, or any of its employees.