In their general session, Adam J. Fein, PhD of Drug Channels Institute, and Doug Long of IQVIA reviewed the current specialty pharmacy space, ongoing trends and future expectations.
Pharmacy benefit managers (PBMs) continue to dominate the specialty dispensing and payer control is challenging patient access, explained Adam J. Fein, PhD, CEO, Drug Channels Institute, and Doug Long, vice president, industry relations, IQVIA, during their session at Asembia’s Specialty Pharmacy Summit, held May 2-5 in Las Vegas, Nevada.
The top three specialty pharmacies by revenue in 2021, explained Fein, were PBMs: CVS Health, Express Scripts, OptumRx. And payers are not only limiting where patients can go, but they are often sending patients to the specialty pharmacy owned by their PBM.
Another big driver in specialty pharmacy has been 340B. The top three specialty pharmacies are also among the five companies—CVS Health, Walgreens, Walmart, Express Scripts and OptumRx—holding the majority (73%) of 340B relationships. However, the 340B program recently faced a massive change when 16 manufacturers have pulled back from 340B pricing from contract pharmacy networks.
This decision by the manufacturers resulted in a drop in the growth rate of new purchases in 2021 after years of positive growth, Fein explained. For instance, the growth of 340B purchases for mail pharmacies had averaged more than 50% annually for four years, but the growth of new purchases in 2021 was –20%.
Another trend in the market that is important to note is vertical integration, said Fein. The practice of hospitals buying up physician practices “accelerated more than you might think.” The integration has happened particularly in areas with 340B pricing, and hospitals and health systems have started to utilize the same tactics they’ve seen plans and PBMs do: steer patients to their own specialty pharmacies.
Health systems with larger specialty pharmacies were more likely to steer patients to them. According to Fein, 70% of health systems with fewer than 15,000 annual specialty prescriptions either preferred the specialty pharmacy in the health system’s plan or had an exclusive specialty pharmacy for the health system’s plan compared with 86% of health systems with 15,000 to 45,000 prescriptions and 95% of health systems with more than 45,000 prescriptions.
Long continued the presentation by reminding the audience of the market share specialty medicines has. In February 2022, specialty accounted for 49.9% of sales, and the only reason traditional medicines still had a majority was because of COVID-19 vaccines, which are considered traditional medicines. Long noted that he expected specialty medicines to take the majority when the March or April numbers were considered.
Reviewing one- and five-year growth, Long pointed out that generics and biosimilars have helped to slow spending growth in certain therapeutic areas, such as multiple sclerosis and HIV. In addition, oncology showed slowing growth, which was largely due to biosimilars. Another reason for the slowed growth for oncology was that there were fewer tests and screenings for cancers during the pandemic, and patient visits have not yet returned to normal.
Long also explained that payer control was challenging patient access to specialty medicines. Compared with 2013, specialty patients are 20% more likely to not fill a prescription today, and OptumRx, Caremark and Express Scripts have placed controls on more than 75% of specialty medicines. In addition, 79% of specialty patients have a National Drug Code block and 60% have a step edit that they are not able to overcome within 30 days.
In 2021, 81 million prescriptions were abandoned at pharmacies by patients starting a new therapy, and has costs rise, so does the frequency of abandonment. Six percent of prescriptions costing $0 were abandoned, which increased to 20% for costs between $40 and $49.99. When medicines cost between $125 and $249.99, 46% were abandoned, and when they cost $250 and more, 61% were abandoned.
Only 1 in 4 new to brand patients who attempted to fill a launch brand were successful due to payer controls, Long said. Plus, as many as 70% of patients on newly launched drugs are supported by patient assistance programs, which cost the manufacturer. As a result of these and other factors, launch success is becoming more difficult and the time to positive investment is delayed, Long explained.