PBMI2020: Opioid Epidemic Update, Specialty Drugs Rule, and the "Amazonification" of Health Care

March 3, 2020

Our roundup of PBMI2020 meeting so far


The opioid epidemic, the restructuring of the PBM industry, the lack of the “Amazonification” of health care, the increasing shift of drug expenditures to specialty drugs are some of the earlier themes of the Pharmacy Benefit Management Institute’s 2020 National Conference in Orlando.

The three-day meeting got started yesterday. The speakers today include Steven Pearson, the founder and president of ICER; David Calabrese, senior vice president and chief pharmacy officer at OptumRx and a member of the Managed Healthcare Executive editorial advisory board, and Anne Mack, a senior director at Prime Therapeutics.

Barry Meier, a former New York Times writer whose book, Pain Killer, is being made into Netflix series, was the keynote speaker. Meier said there is a common theme to the episodes when drugs and devices “run amok. ”

“A drug or device has real benefit but frequently but frequently that benefit is for a limited number of patients,” Meier said during his presentation. “The problem is that the medical products want to make a lot of money, and they can’t make a lot of money selling a product to a limited audience.”

Specialty market, big and getting bigger
But the “limited audience” seems to be where most of the action is in the pharmaceutical market these days, judging by other presentations at the PBMI meeting.

Ryan Atkinson, senior director of specialty at Maxor National Pharmacy Services Corporation, a specialty pharmacy and PBM headquartered in Amarillo, Texas, described his program focusing on cystic fibrosis, a disease with growing armamentarium of expensive drugs that affects only about 30,000 American. Doug Long, a vice president at IQVIA, noted in his presentation that spending on specialty drugs is growing at 11% while spending on traditional ones is creeping up modestly at 1%.

Long showed a slide based on IQVIA data that showed on a non-discounted basis, top 10 drugs are growing at 24.6% and account for 15.8%. The drugs on that list in order of spend are Humira, Eliquis, Enbrel, Stelara, Keytruda, Trulicity, Januvia, Xarelto, Biktarvy, and Remicade.

Meier said the opioid epidemic has become “everybody’s political hobbyhorse” and referenced the hundreds of pieces of legislation that have been introduced in Congress to deal with the epidemic. Meier also said that the White House hasn’t come to grips with how much money is going to be needed to treat people who have been affected by the epidemic. Ultimately, he said, the solution to the epidemic will be the use of other modalities to treat pain other than opioids-"and there are many available.”

Prior auth for naloxone
Interestingly, Long shared IQVIA data that showed opioid prescriptions peaking in 2011 on a morphine milligram equivalents (MME) basis. His slide included a projection that on that MME per capita basis, opioid prescriptions could decrease by a third to a half over the next five years.

In a sponsored, pre-conference meeting about the opioid epidemic, representatives of Emergent Biosolutions, the Radnor, Pennsylvania, company that makes Narcan, the nasal spray formulation of naloxone, made a case for wider prescription-and fulfillment of those prescriptions, for their product. Becky Gamble said 12 states have some kind of law or guidance about co-prescribing opioids and naloxone (which is also available as auto-injector, sold under the brand-name Evzio) but she said PBMs could do more by instituting prior authorization policies that make require opioids and naloxone to be prescribed together.

“Amazonification”-the some why notsGeorge Hill, a managing director at Deutsche Bank, gave a whirlwind tour of the PBM industry during an afternoon session. He heaped praised on the industry as a counterbalance to branded-drug makers and retail pharmacies but noted that while PBMs have been a very good business for a long time they may be entering a mature phase of few players and some flattening of their favorable trendlines.

Hill also reviewed the current trend toward vertical integration (CVS merging with Aetna, the pairing of United and Optum, Cigna’s tie-p with Express Scripts). Vertical integration reduces friction points that can add cost, he said. But Hill also described how the companies differ on how they want their integrations characterized: CVS and Aetna emphasize how integrated they are, Hill said, while UnitedHealthcare and Optum emphasize their separateness.

After the announcement about its partnership with Cigna and Express Scripts, “Prime Therapeutics is trying to figure out who it wants to be,” quipped Hill.

Hill also appeared to have some fun debunking any ideas about any near-term “Amazonification”of health care, and particularly in the area pharmacy benefit management.

“PBMs are in the business of saying ‘no,’ Amazon is in the business of saying ‘yes’,” said Hill.

He showed a slide of market characteristics that drive Amazon’s growth, which included fragmented end markets (which might apply to healthcare, if you put aside the surge of provider consolidations), low or light regulation (very much not healthcare), convenience selling (not really healthcare, notwithstanding telehealth), and ability to provide price discovery (not healthcare despite the current price transparency efforts).