We have all seen the trend data. The situation is likely to become more complicated, not less so, in the coming years. The annual report by CVS Caremark anticipated that by 2015, specialty drugs will account for 27% of the prescription spend, and that annual growth in the spend can be as high as 22% for 2013, matching the figures for the past few years.1 The data from Express Scripts shows that although the trend for the major traditional product categories was only 0.1% in 2011, the trend for the specialty pharmaceutical category (e.g., anti-inflammatories, multiple sclerosis, cancer, HIV, etc.) was 17.1%.2 Ample evidence now exists that the specialty pharmacy utilization and cost growth will continue in the healthy double-digit range, for at least the next few years. It will be fueled not only by the large number of specialty products in the later stages of clinical development, but other factors as well, including slowly evolving expertise (and commitment) by payers to control access to these products.
A few years ago, I worked on an annual publication sponsored by Bristol-Myers Squibb.3 Similar to other trend reports, we surveyed payers (including corporate employers) to determine how they were reacting to several trends in the industry. We asked them about how they managed specialty pharmaceuticals (in 2008) and what changes they intended to make in 2009 and beyond. Back in 2008, 40% of those surveyed indicated that they already shifted any injectable/infused agents from the medical to the pharmacy benefit, and an additional 16% planned to do so in 2009. At that time, 51% said that by 2008, they had already assigned injectable agents to specialty pharmacy management and an additional 14% said they would do so in 2009.3 It is clear that many health plans and insurers have turned to pharmacy benefit management to manage the growth of the specialty pharmacy category. However, many of these injectable/infusible products would traditionally be part of the medical, not pharmacy, benefit. In some large plans, drugs covered by the medical benefit are evaluated by a dedicated technology assessment committee (or rely on other independent resources, such as private consultants or a national technology assessment body, like Blue Cross and Blue Shield’s). If pharmacy coverage decisions are made by the Pharmacy & Therapeutics (P&T) Committee, does this mean that this body is the de facto tech assessment committee in most plans? This seemed to be the case in the last decade, particularly when it came to certain devices and diagnostics.4 Or will technology assessment committees, when available, decide on pharmacy benefit coverage for these specialty pharmaceuticals? The move to pharmacy benefit management of specialty products clouds the discussion considerably.
It would also help if a universal definition of specialty pharmaceuticals was well accepted, based on cost, distribution, storage, and/or route of administration. I’m showing my age here, but I clearly recall when the term specialty pharmaceuticals generally referred to blood products only, which were almost universally covered through the medical benefit. Fast forward to the 1999 introduction of TNF inhibitors and then similar other office-administered and self-injectable products. By 2013, we’ve added oral agents into the specialty mix.
Today, are payers equipped to determine whether a specialty medication offers real value (or even a reasonable value proposition)? And yet another critical question for payers: In light of recent trends, should the coverage decision making body be removed from the shackles of pharmacy or medical benefit classifications altogether? This infers that a merged group of coverage decision makers, with a composition distinct from that of a traditional P&T Committee or technology assessment committee, may contribute further to the discussion.
Clearly, the P&T Committee backbone of pharmacy decision making in managed care is being tested. In recent years, the need for device (specifically drug-delivery systems) and diagnostic coverage decisions is weighing it down. A new evolutionary step may be needed to help payers meet the challenges of specialty pharmacy products.
(Note: This blog was first published in January 2013 for the Health Payer Council [www.healthpayercouncil.com]).
1. 2011 Insights: Changing Rules Changing Roles.
, CVS Caremark, 2011. Scottsdale,
2. 2011 Drug Trend Report.
: Express Scripts, April 2012. St. Louis, MO
3. 2009 Biotechnology Monitor & Survey.
: Bristol-Myers Squibb, March
4. Mehr SR: The evolutionary role of the pharmacy and therapeutics committee in
technology assessment. Manag Care Interface 2006;19(1):42-45.
1. Does your P&T Committee or Medical Technology Assessment Committee decide whether to cover specialty pharmaceuticals?
2. If a unique body were assigned to making specialty pharmacy coverage decisions, how would its composition differ from that of today’s P&T Committee?
3. What is your greatest challenge (other than the cost trend) in terms of managing the specialty category?
SM Health Communications provides writing, consulting, and market research services for the long-term care and payer markets. Its proprietary P&T Insight™ virtual P&T Committee program is the leading mock P&T Committee product in the field. For more information, please visit www.smhealthcom.com or contact
R. Mehr, President, at Stanton firstname.lastname@example.org.