The Forecast On Specialty Drugs
The forecast says a tsunami may be in our future – a specialty drug tsunami, that is.
According to the AMCP (Academy of Managed Care Pharmacy), the definition of a “specialty pharmaceutical” drug is as follows:
A drug requiring a difficult or unusual process of delivery to the patient (preparation, handling, storage, inventory, distribution, FDA-mandated Risk Evaluation and Mitigation Strategy (REMS) programs, data collection, or administration) or, patient management prior to or following administration (monitoring, disease or therapeutic support systems).
In other words, “high cost”. According to a CVS Caremark 2013 internal analysis, specialty pharmacy spend continues to grow – both in terms of absolute dollars and as a percent of total drug spend. By 2018, spend will nearly double, and at an estimated $235 billion, specialty will represent 50 percent of all drug spend.
Specialty drugs typically treat complex, rare and chronic diseases. Human immunodeficiency virus/acquired Immunodeficiency syndrome (HIV/AIDS), other autoimmune disorders and cancer are the conditions for which many of these types of drugs are prescribed. At this time, no generic equivalents exist.
Any element of your health insurance program that represents a cost of this significance can’t be addressed in this short piece. However, it can serve to raise your awareness and inform you of the dangers of not considering your program options.
The significant costs associated with these medications have self-insured employers asking themselves how to best manage the burgeoning costs while still providing these medications to their enrollees. If they are made too costly for the enrollees, they won’t be able to afford their share and will be unable to experience the life-changing benefits.
The following guidelines should be considered when managing your organization’s specialty drug spend:
1. Work with your Pharmacy Benefit Manager’s Specialty Division to help ensure that waste is kept to a minimum and the necessary protocols are in place, including:
- Preferred pricing (discounts)
- Prior authorization/step therapy (ensures lowest-cost drug is utilized first)
- Dosage limits (ensures appropriate amount of medications is prescribed and effective)
2. Have these drugs administered in the appropriate setting; whatever you spend on specialty under the pharmacy benefit, you are likely to spend an equal amount on specialty medications covered under the medical benefit. Specialty drugs are administered in three settings:
- Doctors’ offices
- Outpatient basis
Don’t ignore the impending tsunami. Taking a more proactive approach now is sure to help prepare you for the increased utilization of specialty drugs in the future.