What “Next Gen” Specialty Drug Cost Management Looks Like


CVS’ Joshua Fredell, Pharm.D., and Tierra Ford, Pharm.D., described how an integrated, proactive approach can engage members and rein in costs.

Healthcare costs are increasing, but when it comes to drug expenditures, it’s only a small fraction of utilizers that account for more than half of their clients’ pharmacy spend, explained Joshua Fredell, Pharm.D., vice president of product development for CVS Health, in his presentation at the third and final day of the 2021 Pharmacy Benefit Management Institute® Annual National Conference.

New specialty treatments that can transform the lives of some patients are coming to market with increasingly higher price tags — some costing hundreds of thousands per year, Fredell noted.

Joshua Fredell

Joshua Fredell

“This means that cost management strategies must evolve to meet next-generation needs: a deliberate focus on curbing specialty spend without compromising plan member outcomes,” said his co-presenter, Tierra Ford, Pharm.D., senior clinical adviser, specialty client solutions, at CVS Health.

In their presentation, Fredell and Ford stressed how digital tools and platforms and connectivity are key to an effective utilization management strategy, so that the member gets the most clinically effective therapy while payers realize durable savings.

Fredell emphasized the importance of connectivity and that the CVS' specialty drug managers have connectivity, or access, to 70% of electronic health record of providers and "digital connectivity" to 85% of members that can be used to go beyond routine messaging around issues like refill reminders.

Fredell also listed three principles that CVS' management of specialty drugs follow: start with therapy with certainty, eliminate waste throughout treatment (he mentioned earlier that 89% of the specialty drug spend is on existing treatment) and intervene when needed. Ford gave some examples of the principles in action. About 30% of Stelara (ustekinumab) may be on a higher dose than necessary. CVS member dosing limits to significant drop in high-dose prescriptions, resulting in $21.1 in gross savings.

Fredell also discussed several pilot projects, including one that provides support to rheumatoid arthritis on oral therapy with the goal of avoiding more expensive therapy if the oral therapy fails. Another pilot project is promoting phototherapy for psoriasis, which is a recognized, effective therapy that is under utilized, Fredell said.

“Proactive monitoring and interventions, powered by advanced data analytics, can engage members with their treatment plans while preventing wasteful spend throughout the duration of therapy,” Fredell said. “(With) an integrated approach to specialty that goes beyond utilization, management can identify more opportunities to manage costs, improve member care and create a more seamless and connected experience for both members and providers.”

Tierra Ford

Tierra Ford

Fredell and Ford also discussed how clinically rigorous utilization management builds the foundation for a strong specialty cost-management program.

“Electronic health record connectivity enables greater visibility to accurate clinical data, including the exact diagnosis and most appropriate therapy for each member,” Ford said. “This makes the prior authorization approval more efficient and minimizes the need for additional provider outreach, supporting a more timely start to the most clinically appropriate therapy while eliminating waste and helping lower payer cost.”

“With specialty drugs accounting for a disproportionate share of the drug development pipeline, formulary and utilization management enhancements ensure that we drive to lowest net cost and get plan members started on a treatment plan based on clinical evidence,” Ford said. “Targeted interventions enabled by proactive monitoring and advanced analytics can help support better health outcomes by identifying members who may not be benefitting from their therapy, (maybe experiencing side effects or a worsening of their symptoms or are at risk for an adverse event.”

The pharmaceutical marketplace is dynamic, and specialty cost-management tactics must evolve to help payer stay ahead of trends and manage rapidly rising costs, Fredell said.

“Doing so effectively demands new approaches that go beyond traditional strategies and aggressive therapy denials, which may not deliver lasting savings,” Fredell continued. “Starting on the most appropriate therapy, ongoing monitoring, and intervening when needed to prevent and eliminate wasteful spend throughout the duration of therapy can help lower payer costs and support plan member health.”

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