Analysis

Hospitals and health systems are building a major presence in the specialty pharmacy industry.

As we demonstrate below, nine out of ten large hospitals now operate a specialty pharmacy. Hospitals and other healthcare providers account for one-third of all U.S. accredited specialty pharmacies.

Clinical and general financial motivations are driving hospitals’ DIY specialty pharmacy growth. The enormous profit opportunities from the 340B Drug Pricing Program offer further encouragement for hospitals. In-house specialty pharmacies are also a valuable hedge against the potential loss of contract pharmacies.

Manufacturers would be wise to incorporate hospitals into channel strategy planning for their specialty drugs. At the same time, antitrust regulators should weigh the impact of hospitals’ growing clout over prescribers of specialty drugs and attempts to steer patients to in-house pharmacies.

Today’s guest post comes from Julia Phillips, VP of Pharma Accounts and Enablement at CoverMyMeds.

Julia discusses the challenges of both access to therapy and patient adherence, specifically during the COVID-19 pandemic. CoverMyMeds’ technology solutions mitigate these issues and ultimately improve patient outcomes.

To learn more, download the CoverMyMeds case study, Overcoming Medication Access Barriers Caused by Prior Authorization.

Read on for Julia's insights.

Time for our annual update on pricing at five of the largest pharmaceutical manufacturers—Eli Lilly, Janssen, Merck, Novartis, and Sanofi. You can find links to each company’s data below.

When rebates and discounts were factored in, drug prices declined—or grew slowly—in 2019. Consistent with our previous analyses, rebates and discounts reduced the selling price of brand-name drugs to about half of their list prices.

This growing disparity between list and net prices continues to inflate the gross-to-net bubble. As the companies’ insulin data illustrate below, the bubble raises costs for patients who are not always benefiting from lower net selling prices.

These data also highlight the lunacy of inflationary rebates that are based on a government pricing metric that approximates a brand-name drug's list price. This is what Senator Charles Grassley (R-IA) has proposed in the Prescription Drug Pricing Reduction Act of 2020. Legislation should shield patients from the excesses of the gross-to-net bubble while enhancing the competitive pressures that are reducing drug prices. Is that too much to ask?

Today’s guest post comes from Rob Brown, VP/GM of RxCrossroads by McKesson Program Pharmacy.

Rob reviews how COVID-19 is changing patient access and adherence to specialty therapies. He then describes specific RxCrossroads’ program changes that are helping patients and providers remain on therapy and navigate this challenging environment.

To learn more, visit www.McKesson.com/RxCrossroads.

Read on for Rob’s insights.

Last Friday’s Executive Orders revived the government’s effort to reform rebates in federal programs. Whether that effort succeeds, today's update reminds us what's still at stake in reforming rebates within the U.S. drug channel.

For 2019, Drug Channels Institute estimates that the gross-to-net bubble—the dollar gap between sales at brand-name drugs' list prices and their sales at net prices after rebates and other reductions—reached $175 billion.

The bubble reflects—and drives—many of patients’ problems and misunderstandings of U.S. drug prices.

However, the political and practical challenges to rebate reform remain daunting. Few people grasp the complex economic interplay of patient out-of-pocket spending, cost-shifting, premiums, and payer incentives.

Despite the pandemic, I remain hopeful that we can help this bubble pop.

NASP 2020 Annual Meeting & Expo Virtual Experience
September 14-18, 2020 | Virtual Experience
www.naspmeeting.com/registration

Utilizing innovation and cutting-edge technology, the National Association of Specialty Pharmacy (NASP) is hosting its 2020 Annual Meeting & Expo, September 14-18, as a full-scale virtual conference experience that includes all that attendees have come to expect and love from the live event. The NASP 2020 Annual Meeting & Expo Virtual Experience promises to be the next best thing to being there!

The conference agenda is jam packed and offers something for everyone, whether you are new to the industry or a seasoned expert. Conference highlights include:

• 26 unique educational sessions and panel discussions, organized into four dynamic CORE tracks – Clinical, Operational, Regulatory, and Patient Experience – to help you focus on what is most important to you
• Earn CPE and CLE credits through in-line programming, satellite symposia and pre-conference workshops
• Encore presentations of the popular sessions
• THREE KEYNOTE PRESENTATIONS
• Jim Kelly, former NFL quarterback and Pro Football Hall of Fame member, will share what it means to be “Kelly Tough”
• Former interim chair of the Democratic National Committee (DNC) Donna Brazile and former chairman of the Republican National Committee (RNC) Michael Steele will give a joint keynote presentation on the political landscape and the 2020 election
• Allan Lichtman, a distinguished professor at American University, scholar, and author will share his predictions for the 2020 election

• Five pre-conference workshops: the CSP Exam Preparation Course, Legal Day, Home Infusion Workshop (1/2 day) and our two newest workshops, Technology Day and Hospital/Health Systems Workshop (1/2 day) (additional fee required for workshops)
• The interactive Virtual Exhibit Hall will feature 50+ exhibitors, representing stakeholders from across the specialty pharmacy industry
• The ever-popular Women in Specialty Pharmacy event, featuring motivational keynote speaker Courtney Clark
• CE satellite symposia
• Poster presentations and author discussions
• NASP Annual Meeting Award presentations – including two new awards – the Specialty Pharmacy Service Excellence award and the Strategic Partner of the Year award
• The NASP Ron Bookman Scholarship Awards
• Direct interaction with industry thought leaders and experts through live Q&A and private chats
• Ample networking opportunities
• Virtual wellness initiatives on Tuesday and Wednesday mornings to help you get up and going
• Personalized avatars and MUCH More!

Register today for this must-see virtual experience!

---

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

The steamy, socially distanced days of summer are here. Cool off by getting up close and personal with our refreshing selection of articles and insights. In this issue:

• Pricing problems for diabetes treatments

• Controversy over Regeneron’s copay support

• Massachusetts concedes that coupons help some patients (but accumulators hurt)

• A 2020 update to my all-time favorite chart

Plus, thoughtful perspectives on diversity from AmerisourceBergen CEO Steve Collis

P.S. Join the more than 9,700 followers of my curated links published on @DrugChannels on Twitter. My recent tweets have highlighted: VC’s pharmacy love, physicians’ biosimilar concerns, drug trend in workers’ comp, copay accumulator news, the outlook for insurance costs, remdesivir pricing, Philly pharmacies, how paid parking boosts telemedicine, and more.

ON SALE! We are offering our 2019–20 Economic Report on Pharmaceutical Wholesalers and Specialty Distributors at discounts up to 35% off. Sale prices valid thru September 8, 2020. The updated 2020-21 edition will be available in October 2020.

Surprise! President Trump signed four executive orders (EO) last Friday afternoon. They cover:

• Pass-through of 340B discounts for insulin and EpiPens

• Rebate reform (!)

• Importation

• Most Favored Nation (MFN) pricing for drugs

The fourth order on MFN has not been publicly released, so I will reserve comment for now.

I see significant challenges in implementing these far-reaching orders. Below, you’ll find the text of the first three along with my commentary and links to Drug Channels articles that will help you make sense of them.

Read on and see if you agree with me.

Today’s guest post comes from Frank Dana, Chief Commercial Officer at ConnectiveRx.

Frank discusses how the loss of commercial insurance coverage will affect the newly unemployed. He describes how ConnectiveRx's affordability tools can help pharmaceutical manufacturers and patients.

To learn more, download ConnectiveRx’s free reference: Five Keys to Building a Successful Copay Strategy in the COVID-19 Era.

Read on for Frank’s insights.

The stunning growth of specialty pharmacies in the 340B Drug Pricing Program has accelerated a troubling trend: Patients covered by commercial insurance and Medicare Part D are footing the bill for 340B savings.

That's the uncomfortable reality of the 340B program’s hidden prescription economics.

Whenever a prescription is eligible for 340B pricing, an insured patient could pay thousands of dollars out of pocket—even as the 340B hospital and its contract pharmacy generate substantial profits. Meanwhile, private health plans and Medicare pay full price for drugs that are sold to 340B covered entities at deep discounts, further subsidizing hospitals and PBM-owned specialty pharmacies.

Below, to show you how this occurs, I follow the dollar for a brand-name specialty drug used by a consumer with commercial insurance. Our indisputable math exposes the little-understood economics behind specialty pharmacies in the 340B program.

I hope that the program’s participants take an honest look at who is actually paying for their 340B savings. As always, I welcome your feedback via email or in the comments below.