Forecast includes increased use of chronic care drugs in 2011


Pharmacy benefit programs will clearly see operational and economic changes in 2011, from phasing out the donut hole to growth in specialty pharmacy

Key Points

PHARMACY BENEFIT PROGRAMS will clearly see operational and economic changes in 2011, from phasing out the donut hole to growth in specialty pharmacy. Likewise, an increase in utilization of chronic-care drugs and a potential plateau in the use of generics are factors driving pharmacy trends next year.


He prescribes better management of the total cost of care, more aggressive use of utilization tools, such as prior authorization, and the promotion of preferred drug therapies in certain classes.

Although he anticipates that the gain from generics may lose steam as the opportunities dwindle, Calabrese says there are still some blockbusters yet to come off patent.

On the other hand, specialty pharmacy is on the rise, and costs in that category will dwarf any savings gained from the use of non-specialty generics.

The results of a national survey of more than 120 insurers and administrators, conducted by Buck Consultants, indicate an average prescription drug trend of 11.3%. However, PBMs, who usually do not assume any underwriting risk, report only a 5.8% increase. Harvey Sobel, principal and consulting actuary, Buck Consultants, Secaucus, N.J, says this is the biggest spread he has ever encountered between insurers and PBMs.

He attributes the jump to the new federal excise tax to be imposed on certain manufacturers of branded products based on annual sales starting in 2011, as a result of the reform law.

Calabrese points to the pathway for biosimilars and the phase-out of the Part D donut hole-in which manufacturers will pick up half the costs assumed by beneficiaries-as two additional drivers for 2011.

Judy Cahill, executive director, Academy of Managed Care Pharmacy (AMCP), questions the clarity of the new statute related to the donut hole.

"The statute says that pharma companies will pay 50% of the cost of 'applicable drugs' once a Medicare beneficiary reaches the donut hole; however, CMS has not defined 'applicable drugs,'" she says. "The way a Medicare Part D contractor will find out if it has correctly classified a drug as 'applicable' is only after CMS adjudicates a claim for reimbursement. If CMS determines the medication is not an 'applicable' drug, it will not process the claim and deny payment to the Part D plan."

Buck's Sobel says that the phasing out of the donut hole will place an extra burden on manufacturers, causing them to raise prices.

Related Videos
Related Content
© 2024 MJH Life Sciences

All rights reserved.