Author: Randy Chase

There are almost always one or a few people within a specialty pharmacy that can wax on at length over the topic of compliance. Compliance is a broad term for many companies, but especially in the healthcare area.

Specialty pharmacies need to be very careful in ensuring that they are in full compliance with federal and state laws, Boards of Pharmacy requirements and a host of regulatory agencies. It is a full-time job.

The article below is one that those compliance ‘nerds’ should be able to write on their own. We offer it up for the rest of us that should know enough about this important topic to be dangerous. It is a bit of a long read but it is offered up in small digestible pieces. I always encourage people working in this industry to understand all of the working parts that are essential to ensure that they will survive and thrive in an increasingly competitive marketplace. So, give it a speed read at a minimum.

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20 Elements of an Effective Pharmacy Compliance Program: A Nonexclusive List of U.S. Pharmacies’ Obligations Under Federal Law

Pharmacies operating in the United States are subject to a host of compliance obligations under federal law. These compliance obligations touch on all aspects of pharmaceutical practice, from drug ordering and inventory management to billing public and private payers. Despite the extraordinary scope of pharmacies’ compliance obligations, federal authorities do not excuse oversights. If an audit, investigation, or whistleblower complaint reveals evidence of shortcomings in any respect, pharmacy owners and pharmacists-in-charge can expect to face significant ramifications.

With this in mind, for pharmacies in the U.S., compliance needs to be a priority. Pharmacies cannot rely on the excuse of being overburdened with high demand, and they cannot expect to escape scrutiny if……….. CLICK HERE TO ACCESS THE FULL ARTICLE

Oberheiden P.C. © 2020
National Law Review, Volume X, Number 210

OK, this is not fake news….. the press release below details a new, exclusive-distribution arrangement for an oral therapy, Lysodren, with an indication for inoperable, functional or non-functional adrenocortical carcinoma.

Is this big news….. Not really.
Is this odd news…. Yes it is.
Why?
Because Lysodren (mitotane) was first approved in 1970….. yes, 50 years ago.

Mitotane is on the list of ‘Off-Patent, Off-Exclusivity Drugs without an Approved Generic’ as published in the Orange Book. Why it doesn’t have an approved generic is anybody’s guess….. there are lots of old brand drugs with no generics on that list waiting for someone to come along and relaunch an old cheap drug at 100+++ times the old price. Currently, Lysodren runs only $500+ per month of therapy.

The new FDA Label includes a black box warning for adrenal crisis…. which may be the primary reason that this drug is going limited distribution.

It appears that there is renewed interest in this old therapy. Over the decades it has been used routinely by veterinarians to treat carcinoma in animals.

AllianceRx Walgreens Prime named exclusive distributor for HRA Pharma Rare Diseases

FDA-approved prescription drugs Lysodren® and Metopirone® in the United States

Oct 29, 2020 — ORLANDO, Fla. and MORRISTOWN, N.J. and CHATILLON, France, PRNewswire. HRA Pharma Rare Diseases has named AllianceRx Walgreens Prime as the exclusive specialty pharmacy and clinical support provider for two of its rare disease drugs, Lysodren and Metopirone.

Lysodren (mitotane) is the only FDA-approved drug to treat inoperable, functional or non-functional adrenocortical carcinoma, a rare cancer of the adrenal glands. Metopirone (metyrapone) is used as a diagnostic test for adrenocorticotropic hormone (ACTH) insufficiency and in the diagnosis of ACTH-dependent Cushing’s syndrome. ACTH is a hormone produced in the pituitary gland in the brain.

“We are very excited to be the exclusive pharmacy to dispense these medicines,” says Tracey James, senior vice president of pharmacy services at AllianceRx Walgreens Prime. “HRA Pharma Rare Diseases recognizes our ability to clinically support patients throughout their treatment journey and link them to financial resources so they can obtain these life-changing medicines. HRA Pharma Rare Diseases and AllianceRx Walgreens Prime share the same goal of providing the best possible outcomes for these patients.”

Evelina Paberze, chief operating officer of HRA Pharma Rare Diseases, says, “At HRA Pharma Rare Diseases, we are dedicated to giving our patients improved access to essential treatments. The decision to make AllianceRx Walgreens Prime our exclusive specialty pharmacy and clinical support provider means our rare disease patients in the U.S. will get improved access to Lysodren and Metopirone.”

David Wright, chief executive officer of HRA Pharma, says, “At HRA Pharma, we constantly strive to provide accessible and affordable solutions to our patients. I believe making AllianceRx Walgreens Prime the exclusive pharmacy of our rare diseases affiliate is a step in the right direction to achieving this goal.”

For full prescribing information on the drugs listed above, including the black box warning for Lysodren®, visit dailymed.nlm.nih.gov.

We’ve often admonished people working in specialty pharmacy to be in the forefront of new developments. That’s easier said than done especially since the low hanging fruit in SP innovation has already been implemented.

The article below details something that is innovative under the SP umbrella, the concept of inserting Genetic Counseling into the SP model. The number of newly approved gene-based therapies is on the rise so the demand for counseling makes perfect sense. Why not insert it at the point of care where patients have the most interaction with pharmacists, at the point of dispensing.

This raises a serious question for specialty pharmacists…..
They already have to step up their game to master the clinical pharmacology of the new therapies. Do they also want to expand their role beyond clinical pharmacy to include the complex elements of genetic counseling? As the authors of the article below point out, genetic counseling must also include psychological counseling to assist patients make ethical choices about diagnostic testing and therapy selection. Does that mean SPs would staff a dedicated genetics counselor to work hand in hand with the pharmacist?

One area that the authors do not address is cost. Since it is likely to be complex and time-consuming, cost is a real concern. Who will pay a specialty pharmacy for counseling? Will payers compensate for the counseling if provided by a specialty pharmacist or a specialty pharmacy staff professional? If not, will a manufacturer of the genetic therapy step up to underwrite the counseling? That would make sense especially if the counseling resulted in improved adherence. We also believe that these uber expensive therapies will also be launched under value-based contracts with payers.

So, specialty pharmacies may want to think on this opportunity. Note, however, that virtually all genetic therapies approved so far have been launched through limited distribution. But, consider that offering genetic counseling might be the key differentiator that will propel your specialty pharmacy to be selected as a manufacturer’s limited distribution partner.

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The Expanding Roles of Genetic Counselors in Specialty Pharmacy Management

2020-10-29 — Pharmacy Times — Traditionally, the role of genetic counselors has been dedicated to caring for patients and families affected by genetic conditions. Today, genetic counselors apply their molecular and clinical expertise in diverse roles, many delivered via telehealth.

Recent rapid advances in gene-based therapies represent additional roles for genetic counselors throughout the health care system, including collaborations with pharmacy professionals. Here’s a look at some evolving changes and potential future shifts in how genetic counselors and pharmacists collaborate.

Prior authorizations (PAs) and specialty pharmacy
As health care practitioners prescribe genetic-driven therapies and seek PA from a health plan, pharmacy benefit managers play a critical role in determining if that request is appropriate for the patient. These prescriptions are often tremendously expensive. If they are misprescribed even 1% of the time, the result is potential harm for patients and a big financial waste.

As more therapies come online, an expert genetic counselor provides a valuable clinical and molecular review, as well as confirmation during the PA process. Beyond authorization, the majority of gene therapies fall to the specialty pharmacy at the point of dispensation.

Pharmacists in these environments may not have extensive molecular genetics training and often need to confirm that a gene-based therapeutic is appropriate and/or to educate patients. A genetic counselor can help patients clearly understand a drug’s mechanism of action and discuss whether it is a good fit with the genetic cause in their case.

Clinical genetic counseling services are typically covered by patients’ health insurance, including when delivered via telemedicine.

Navigating the testing landscape
Most pharmacists bring a level of genetic knowledge and understand the “why” behind a specific genetic therapy and the patient’s specific mutation. However, in some situations, lab reports and associated patient information could nudge a pharmacist outside of her or his comfort zone.

Lab reports generated in the United States are far from standardized. The same test result may look very different, depending on which lab it comes from.

Pharmacists, regardless of where they work in the health care system and patient treatment chain, may need added expertise in laboratory result interpretation and genetic nomenclature to precisely review molecular test results that may look different from one laboratory to another, even when dealing with the same disease and gene as a previous case.

In the landscape of genetics, there can also be different variants within a gene that have different impacts on a case. There is not a magical test that looks at all of those things equally and effectively, so added expertise helps.

Some variants, for example, are not normal or typical but are not likely problematic either. They fall into the gray zone of “variants of uncertain significance.”

It can be very challenging to understand how to interpret these results in the context of evaluating eligibility for a particular medication. In addition, sometimes a genetic diagnosis rests not solely on molecular results, but instead on a group of clinical features.

Clinical diagnostic expertise, in addition to the understanding and interpretation of molecular results, may be needed to establish a diagnosis. These are all skill sets that are in the genetic counselor’s toolbox—they are able to determine whether a patient meets diagnostic criteria for a particular indication or, alternately, if a diagnosis is sufficiently unclear and additional workup or testing to clarify the diagnosis may be indicated.

The patient education role
Through the years, the pharmacist role has evolved from dispensing to include direct care. Some pharmacists provide services such as glucose testing, immunizations, and blood pressure monitoring.

With closer patient contact, the educational role for the pharmacist increases as well. In the world of genetic therapies, they should expect the need to advance their knowledge base or to align with genetic counselors to add value to their role in the patient care process.

In addition to deep expertise in medical genetics, genetic counselors have extensive psychology training, and their bread-and-butter work involves explaining complex genetic information to patients who have minimal to no understanding of the subject. These skills can be of value whether working alongside pharmacists or providing professional education to them.

Let’s use the case of retinal dystrophy as an example, which causes blindness at a very young age. In 2017, Luxturna was approved for a very narrow subset of retinal dystrophy patients, those with a mutation in both copies of the RPE65 gene.

Luxturna offers a working version of the RPE65 gene that acts in place of the gene’s mutated version. This small subset of patients often experiences restored vision.

If a family member has retinal dystrophy but shares only 1 of their relative’s 2 genetic mutations, and is hopeful for that same outcome, it can be difficult for the patient and family to understand that their particular cause of the disease is not amenable to this treatment.

Luxturna is administered through in-patient settings, so the educational role of the genetic counselor would likely not be alongside pharmacists, but instead with the physician and patient leading up to treatment delivery. However, with information widely available on the internet, patients with retinal dystrophy and their families who are not offered the therapy may approach physicians, pharmacists, and other medical professionals on their care journey and request detailed explanations.

In these cases, the genetic counselor could step in and serve as a valuable resource. Bridging that gap between the patient’s and family’s hope and understanding is a key role for genetic counselors.

A key neutral party
Situations also arise in which a therapy may be a sizable cost to the patient but the benefits are only marginal. Genetic counselors are trained in facilitating decision-making, and are often the informational source that helps a patient understand, “What is the true value for me?”

At times, there is a need to filter out advertising, marketing, and other noise surrounding a particular therapeutic. The complex collection of players involved in patient care brings competing views.

The pharmaceutical companies may have a lot of bias and marketing sway. Physicians care about patients and will sometimes take risks to make them happy. Payers may not want to cover something if uncertainties exist.

Having a public health-minded independent party who will consider the best interests of the patient can neutralize these competing interests by focusing on facts, level-setting true benefits for them, and helping patients develop realistic expectations.

Experiences in patient-facing moments, behind the scenes during PA deliberations, and in the trenches of analyzing genetic tests all serve to drive genetic therapies forward and guide better future utilization. Genetic counselors can add significant value to this process.

Integration of genetics expertise will only become more important as a greater number of therapies come to market.

About the Authors
Gwen Fraley is Director of Clinical Policy at InformedDNA.
Heather Dorsey, is Evidence Review Manager, at InformedDNA

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The article below, How Specialty Pharmacies Can Safeguard Against Fraud When Using Patient Assistance Programs, details yet another case including a specialty pharmacy. In this instance the SP was pinched by the feds for participating in a scheme to mickey with patient co-pay programs for Copaxone. Advanced Care Scripts, an Orlando based specialty pharmacy, was recently fined $3.5 million!

The details of the case are summarized in the article (link below)… but here’s the bottom line. If you want to avoid a big financial penalty, don’t step over well-defined lines of business behavior to collude with a manufacturer to violate laws.

Here are some best practices from the article that can keep specialty pharmacies (you) out of hot water related to patient assistance programs:
Carefully review data elements provided to drug manufacturers in data reports to ensure information about charitable support or status of a charitable support request is not provided.
Do not enter into contractual arrangements with drug manufacturers to coordinate charitable foundation support. Assisting patients in identifying such funding should be conducted as part of the pharmacy’s core services and not as directed by a drug manufacturer.
Train staff to avoid any coordination with pharmaceutical manufacturers on the provision of charitable funding to patients. This includes not only through contractual agreements but also by avoiding such discussions informally or in scheduled business reviews.
Ensure robust contractual language is in place clearly prohibiting pharmaceutical manufacturers from utilizing data provided by the specialty pharmacy to make charitable funding decisions.

One need not have been a lawyer to know when lines had been crossed in the ACS/TEVA case. Since $3.5 million is a whole lot bigger number than, say, $5000-$10,000 in legal fees, having your SP’s lawyer on speed dial might be the very next thing you do today.

Click here to read the complete article from Bass, Berry & Sims PLC

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Anton RX Reports are copyrighted by Anton Health, LLC.

HIPAA…. We all know everything there is to know about HIPAA, right??
…… Wrong.

One aspect of HIPAA that gets almost all the attention is how to prevent breaches of private healthcare information. If your specialty pharmacy is accredited, you have been through a bunch of orientations pounding the requirements into your brain.

But, how many orientations have you survived that focus on what to do after a breach of private information? We’ve provided a link to a good, but lengthy, article for your reading pleasure….. Ensuring Transparency: Language to Avoid in HIPAA Breach Notifications. The article is well worth a read if you are a specialty pharmacy professional….. for HIPAA compliance officers this should be a must read.

The author correctly states, “Breach notifications [to patients following a breach] often contain wishy-washy wording… while it may meet the minimum legal requirements, it doesn’t really tell people what actually happened to their personal information.”

In terms of transparency when it comes to HIPAA, notifications must include a brief description of the breach, types of information involved, steps affected patients should take to protect against potential harm, and what the covered entity is doing to both investigate the breach – and to prevent future incidents. Notices must also include contact information.

Health care providers should also be aware that HIPAA is not the only regulation that should govern their response to a security incident. States, federal regulations, and even foreign laws like the General Data Protection Regulation, may also govern the appropriate response.

So, is that it? Oh, no it is not.

The primary requirement in the aftermath of a breach is to be transparent in the notice to impacted patients. The secondary requirement is to know what language to avoid when making those communications.

Here are some highlights—-
avoid language that creates more uncertainty or anxiety
focus on what is known, not what is unknown , do not engage in speculation
avoid unsubstantiated facts….. but state (when pertinent) that certain facts may not known or are being withheld for security, legal or other reasons and provide supplemental notifications when more facts are known and can be shared
avoid deflecting blame for the incident by accepting qualified responsibility
don’t attempt to place the blame on another entity, such as the threat actor or a third-party vendor.

The article finishes with a section on best practices.

Click here to read the full article

Specialty pharmacies don’t think much at all about sales tax on prescriptions. That’s because only two states, Illinois and Minnesota, impose a sales tax on legend drugs. That might be the end of the story….. but there is more, so read on.

Walgreens Specialty Pharmacy, as an out-of-state pharmacy, had been dispensing millions of $$$s worth of prescription drugs over a five year period. They were assessed the state sales tax but requested a credit for those taxes thinking that they were an out-of-state vendor. However, the tax court felt differently and it ended up in the MN Supreme Court.

In Walgreens Specialty Pharmacy v. Commissioner of Revenue, the court held that Minnesota’s 2% gross receipts tax on sales of prescription drugs could be imposed on out of state pharmacies selling to Minnesota residents. OUCH!!

So, SPs may want to assess their own financial exposure to sales tax as an out-of-state vendor…. at least in Minnesota. More states may start taxing prescriptions given their dire financial straights caused by the pandemic.

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Do Prescription Drug Sales Taxes Apply to Out-of-State Pharmacies?

Issue of the Case
When an out-of-state specialty pharmacy distributes medications to residents of a state that has enacted a legend drug tax, is that out-of-state vendor subject to the 2% tax assessment?

Facts of the Case
A national pharmacy chain operated a multisite specialty pharmacy with dispensing locations in 6 states, but it did not have a location in the state that enacted a 2% legend drug tax, the state where this litigation arose. The state’s board of pharmacy had issued pharmacy permits to all the pharmacy locations operated by the firm, allowing it to ship medications to residents of the state. However, the specialty pharmacy did not own or rent any locations in the state, nor did it have employees there.

The firm did employ an in-state representative to promote its services to institutions, prescribers, and others. It did have contracts in place with health insurers and others to sell legend pharmaceuticals prescribed by in-state prescribers to in-state patients. It maintained a website that patients could use to request refills. During the 5-year period that was the focus of this litigation, the pharmacy provided hundreds of thousands of prescriptions to citizens of the state worth hundreds of millions of dollars.

The prescription orders were fulfilled with legend drugs obtained from manufacturers or wholesalers located outside the state. The specialty pharmacy would present the prepared medications to a common carrier, such as Federal Express or United Parcel Service, which would deliver them to the patient’s home or a treatment facility where they were to be administered.

The specialty pharmacy operated as a limited liability company and filed amended tax returns with the state’s department of revenue requesting a refund of the 2% legend drug taxes that it had paid on its wholesale cost for the prescription medications that it had sold to patients in the state during the 5-year period.

The commissioner of revenue denied the claimed refund, so the specialty pharmacy appealed the decision to the state’s tax court. That judicial entity agreed with the pharmacy, ruling that the tax did not apply to these wholesale transactions because the pharmacy had received the medications outside the state.

In the course of announcing its decision, the tax court recognized that a provision in the relevant state tax statute “provides that delivery of drugs with the state can trigger liability for the tax.”

However, this court ruled that the statute imposes tax “solely on the receipt of drugs.”

That meant the specialty pharmacy was due the claimed refund because it received the drugs outside the state. The commissioner of revenue disagreed and took the case to the state Supreme Court.

The Ruling
The highest court of the state disagreed with the tax court, ruling in favor of the commissioner of revenue’s interpretation that the tax assessment did apply to the specialty pharmacy.

The Court’s Reasoning
The state Supreme Court pointed out that the statute in question, the legend drug tax, was one of a number of state statutes creating provider taxes applicable to the gross revenues of hospitals, pharmaceutical wholesalers, and surgery centers to fund a state-level health insurance initiative for individuals with low incomes. This program supplements the state’s Medicaid program because it has higher income limits than Medicaid.

In the case of pharmaceuticals, the tax is calculated at 2% of the “price paid [wholesale cost]” by those who deliver or receive legend drugs in the state.

The court clearly demarcated the line of division between the parties: The pharmacy argued that the statutory tax applies only to the receipt of drugs in the state, whereas the revenue department took the position that the tax assessment applies to in-state sale or delivery of the medications.

The court turned to 2 accepted principles of statutory interpretation: First, when the intent of the legislature is clear from unambiguous language of the statute, the statute is to be applied according to its plain meaning; and second, statutes are to be interpreted to give effect to all their provisions and assume that the legislature does not intend to enact unconstitutional statutes.

Applying those principles, the state’s highest court concluded that “The plain language of the statute at issue here encompasses out-of-state pharmacies that deliver legend drugs to in-state patients for use within the state.”

Joseph L. Fink III, BSPHARM, JD, DSC (HON), FAPHA

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For more information contact:
Jim Larweth
Anton Health
773-230-2525
Jim.Larweth@AntonHealth.com

www.AntonHealth.com

Anton Health is pleased to announce its recent acquisition of the assets of Specialty Pharmacy Solutions (SRx), a strategic planning, marketing, and operations consulting organization exclusively focused on the Specialty Pharmacy segment.

Since its founding in 2018, Anton Health has become one of the healthcare industry’s most respected consulting organizations, offering highly tailored support services to pharmaceutical manufacturers seeking to develop strategically sound marketing strategies.

Anton Health’s Executive Vice President, Jim Larweth, said “The acquisition of Specialty Pharmacy Solutions not only allows Anton Health to greatly expand its service offerings to our pharmaceutical manufacturer clients, but also supports our partnership expansion with Health Plans and Specialty Pharmacies.”

Increasing demand for specialty drugs to treat complex or serious chronic conditions, and how to pay for them, has become a central concern for both pharmaceutical manufacturers as well as payers.

Since 2005, Specialty Pharmacy Solutions has published an online journal, the SRx Client Alerts. Over that period, SRx has published more than 3,000 Alerts covering virtually every significant development in the Specialty Pharmacy industry, offering its subscribers expert insight into the significance of each development. Going forward, the SRx Client Alerts will be rebranded as the Anton Rx Report.

“I’m excited to join the team at Anton Health, and to continue writing content for the expanding Anton Rx Report”, said SRx President Bill “Sully” Sullivan. “We plan to bring even greater value to the thousands of managed care industry professionals that we reach on a weekly basis by not only sharing breaking news, but adding actionable insights.”

About Anton Health
Anton Health was designed specifically to help pharmaceutical manufacturers navigate the evolving payer landscape. Whether gaining expert insights via the Anton Health Network™, or accessing real-time market intelligence via their RapidApp™, Anton Health works closely with clients to formulate contracting strategies, gain feedback on pre-launch product positioning, and monitor the competitive landscape for improved profitability.

About Specialty Pharmacy Solutions (SRx)
SRx provides expert consulting support to the Specialty Pharmacy industry. Over the past eighteen years, SRx has counted virtually all of the top fifty specialty pharmacies as clients. Working with pharmaceutical manufacturers, SRx has been involved with the launch of more than twenty specialty therapies to the marketplace. It has also designed and launched specialty pharmacy networks for national payer organizations and PBMs.

For more information contact:
Jim Larweth
Anton Health
773-230-2525
Jim.Larweth@AntonHealth.com

www.AntonHealth.com

Yes, time to groan, another missive on the 340b program. At least there are some new statistics about the program that should wake up the majority of specialty pharmacies that aren’t skimming the cream off this program unlike a few others. The 340b program has come under the most intense scrutiny that we’ve seen in years. As we mentioned in our last Alert, the full court press by Pharma (against 340b) and the hospital industry, lobbying just as hard to preserve 340b, is fierce. Key findings from the referenced report (Note, it was sponsored by Pharma) show that many retail pharmacies and other third parties have taken advantage of and financially benefited from the 340B program’s contract pharmacy arrangements: — The data showed an average profit margin of 72% on 340B medicines commonly dispensed through contract pharmacies vs. a margin of 22% for non-340B medicines dispensed through independent pharmacies. — 340b covered entities and their contract pharmacies generated an estimated $13 billion in gross profits on 340b purchased medicines in 2018, which represents more than 25% of pharmacies’ and providers’ total profits from dispensing or administering brand medicines. — Following HRSA’s expansion of the contract pharmacy program in March 2010, contract pharmacy participation grew a staggering 4,228% between April 2010 and April 2020. While over 27,000 distinct pharmacies participate in the 340B program today, over half of the 340B profits retained by contract pharmacies are concentrated in just four pharmacy chains – Walgreens, Walmart, CVS Health and Cigna’s Accredo specialty pharmacy. A word on specialty pharmacy participation. Statistics were not available to adequately break out SP revenues by pharmacy type (SP vs. retail/chain). We believe that the lion’s share of specialty prescriptions is being filled by the handful of big box SPs. That’s not surprising as a hospital is likely to select a primary pharmacy partner to consolidate all its 340b transactions into one, more manageable relationship (just like a manufacturer selecting a limited distribution partner for a newly launched drug.) Click here to read the full report , “For-Profit Pharmacy Participation in the 340B Program” __________________________________________________________________________ New Analysis Shows Contract Pharmacies Financially Gain From 340B Program with No Clear Benefit to Patients New Analysis Shows Contract Pharmacies Financially Gain From 340B Program With No Clear Benefit to Patients WASHINGTON, Oct. 8, 2020 /PRNewswire/ — Today, the Berkeley Research Group (BRG) published an analysis of historical trends in 340B contract pharmacy arrangements. The findings conclude that the growth in the number of these arrangements is fueling explosive growth in the program at large and driving the 340B program farther and farther away from its original intended goal of providing discounted medicines to safety-net entities treating uninsured and vulnerable patients. Congress created the 340B program to help safety-net providers, including certain qualifying hospitals and federally funded clinics, access discounts on prescription medicines for low-income or uninsured patients. In 2010, a Health Resources and Services Administration (HRSA) policy opened the door to allow all 340B entities to contract with an unlimited number of for-profit retail pharmacies (e.g., CVS, Walgreens) to dispense 340B medicines. While this policy may have been intended to improve patient access to needed medications, it had the misguided effect of creating an opening that allowed for-profit vendors, pharmacies and pharmacy benefit managers to exploit the program and make a profit on 340B sales – sales intended to benefit low-income and vulnerable patients. “It is clear that contract pharmacies have leveraged market power to drive unprecedented program growth and siphon money out of the program and away from vulnerable patients,” said Stephen J. Ubl, president and chief executive officer of the Pharmaceutical Research and Manufacturers of America (PhRMA). “I urge lawmakers to consider the results of this analysis and pursue policies that ensure the 340B program benefits vulnerable patients rather than just line the pockets of for-profit corporations.” Analysis after analysis shows there is explosive growth in the program, but there is little to no clear evidence that this growth has benefited low-income and vulnerable patients. Even the New England Journal of Medicine found no evidence that expansion of the 340B program has resulted in improved care or lower mortality among low-income patients. These new findings build upon a mounting body of evidence from the Government Accountability Office (GAO) and HHS Office of the Inspector General, which show hospitals are taking advantage of contract pharmacy arrangements to generate additional revenue through 340B without ensuring that low-income patients are benefiting from manufacturer discounts. GAO found that more than half of 340B hospitals surveyed reported that they did not share discounts with patients at their contract pharmacies. OIG found similar evidence, noting some 340B hospitals “do not offer the 340B price to uninsured patients in any of their contract pharmacy arrangements. … [I]f covered entities do not, their uninsured patients pay the full non-340B price for prescriptions filled at contract pharmacies.” To learn more about the 340B program and ways to fix the program, visit PhRMA.org/340B. About PhRMA The Pharmaceutical Research and Manufacturers of America (PhRMA) represents the country’s leading innovative biopharmaceutical research companies, which are devoted to discovering and developing medicines that enable patients to live longer, healthier and more productive lives. Since 2000, PhRMA member companies have invested nearly $1 trillion in the search for new treatments and cures, including an estimated $83 billion in 2019 alone. Source: Pharmaceutical Research and Manufacturers of America (PhRMA)

Many are starting to question whether there will be a future for specialty pharmacy…. at least how we know it today. That being said, an optimist would say that even a buggy whip company could remain viable after the arrival of the automobile with enough innovation.

Specialty pharmacies don’t have mush room left to be innovative. Much of that innovation has already taken place with the emergence of advanced data management capabilities, integrated electronic health records to expedite and monitor patient status through artificial intelligence, tailored therapy-specific care management protocols, numerous operational efficiencies, etc. But one area still remains an opportunity for improvement and innovation, Value Based Initiatives.

The article below is a good overview of how and where specialty pharmacies may develop that innovation and ensure that their businesses will not go the way of the buggy whip company. “Working with patients, caregivers, prescribers, payers, and pharmaceutical drug manufacturers, specialty pharmacies promote value by coordinating care for complex health conditions across a diverse range of stakeholders and uniting patient touch points within a fragmented health care system.”

As the concept of value-based arrangements is evolving, the interest level by health plans is climbing. Value based deals are still tough to measure since results may need to be based on long timelines (years?) and metrics need to be precise (not easy…. but that’s where a specialty pharmacy can best participate, especially under the medical benefit which has historically been a black hole.)

The article spotlights a framework and five elements for specialty pharmacies to pursue.
— Understanding Shared Health Needs of Patients
— Designing Comprehensive Solutions to Improve Health Outcomes
— Integrating Learning Teams Measuring Health
— [Linking] Outcomes and Costs
— Expanding Partnerships

These elements add up to a more powerful model for specialty pharmacy that should be sustainable for the foreseeable future.

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How Specialty Pharmacy Will Thrive in the Value Era

2020-10-08 The era of fee-for-service health care is nearing an end. In its place, value-based initiatives seek to improve patient outcomes, reduce cost, and increase transparency in health care. These changes represent significant opportunity for specialty pharmacies to demonstrate their ability to create sustainable value across the health care continuum.

The Need for Value-Based Initiatives
The United States spends more per capita on health care than any other developed nation. According to the CMS, National Health Expenditures (NHE) in the US are predicted to outpace the growth of GDP through 2027 when health spending is predicted to exceed $6 trillion.

Despite spending the most, the US falls behind other developed countries in several key health indicators. The US has the highest incidence of chronic disease burden, the highest rates of obesity, and among the largest numbers of both preventable hospitalizations and avoidable deaths. Coupled with an aging population, rapidly expanding drug portfolios, and a fragmented health care system that tends to promote volume over outcomes, it’s clear why there is a push for change.

A Framework for Value
Michael Porter is a Harvard Business School professor whose extensive work in economics, strategy, and social causes has earned worldwide recognition. Porter and Elizabeth Teisberg wrote the book Redefining Healthcare, providing a widely accepted framework for a value-based health care system. They define value in health care as “The measured improvement in a patient’s health outcomes for the cost of achieving that improvement.”

In addition to defining value in health care, Porter describes a “paradox” in the US health care system which focuses on shifting cost and increasing bargaining power while restricting patient choice—none of which ultimately create value for the patient. Porter proposed a set of principles focused on high-quality, less costly care, improving value for patients, advancing unrestricted competition based on results, focusing on the full cycle of care, and value that is driven by provider experience, regional and national competition, transparency, and strongly rewarding innovation.

In a recent article in the Journal of the Association of American Medical Colleges, Teisberg et. al provide a strategic framework for implementing value-based health care. The framework includes 5 broad imperatives for value: understanding shared health needs of patients, designing comprehensive solutions to improve health outcomes, integrating learning teams, measuring health outcomes and costs, and expanding partnerships. These 5 imperatives have significant implications for health care delivery and defines a space where specialty pharmacy has opportunity to act as a driver of value within the broader health care system.

Value Based Care and Specialty Pharmacy
Specialty pharmacies are uniquely positioned to thrive in the era of value-based health care. Working with patients, caregivers, prescribers, payers, and pharmaceutical drug manufacturers, specialty pharmacies promote value by coordinating care for complex health conditions across a diverse range of stakeholders and uniting patient touchpoints within a fragmented health care system. Driving positive patient outcomes and managing costs are at the core of specialty pharmacy services.

As the Medicare Access and CHIP Reauthorization Act of 2015 and other federal legislation seeks to fundamentally change health care delivery and payment for health care services, specialty pharmacies are successful because of their proven ability to drive value in spite of the existing health “paradox” as described by Porter. Independently owned specialty pharmacies in particular are in a unique position in the current shift to value-based care because they are already organized around the imperatives as outlined by Teisberg while functioning outside of health systems and third-party payer organizations more closely tied to the fee-for-service system.

Specialty pharmacies align under Teisberg’s 5-point framework as follows:

Imperative 1: Understanding Shared Health Needs of Patients
Specialty pharmacies understand the unique clinical needs of patients with complex, often chronic health conditions and the drugs used to treat them. Specialty pharmacies build clinical programs with clinicians and staff who have extensive training and experience with specific disease states, drug classes, and comorbid conditions. Specialty pharmacists take the time to understand the unique clinical, psychosocial, and financial needs of the patient groups they serve, promoting continuity and establishing relationships based on trust and mutual understanding. Understanding the broad needs associated with a particular condition such as hemophilia or drug class such as IV/SC-Ig allows experienced clinicians to deliver targeted, individualized care to a specific group or groups of patients.

Imperative 2: Designing Comprehensive Solutions to Improve Health Outcomes
Specialty pharmacies use medication therapy management (MTM) to coordinate comprehensive care for patients and improve health outcomes. MTM employs a range of clinical tools to improve outcomes and promote value, including therapeutically focused clinical assessments, validated quality of life measures, detailed medication reconciliation, monitoring adverse effects, connecting patients to educational resources, peer-based support programs, and access to need-based financial resources reducing barriers to care. Specialty pharmacies provide patient level support reducing health system and therapy complexity by explaining benefits and coverage, coordinating the best site of care for injected or infused medication, providing drug administration training, adherence support, and resources empowering patients to independently manage complex, persistent treatment plans.

Imperative 3: Integrating Learning Teams
Specialty pharmacies leverage highly experienced, multi-disciplinary teams to promote value. By integrating clinical teams with intake, billing and care coordination specialists, specialty pharmacies speed access to care, remove barriers to treatment, and reduce therapy abandonment. Integrating clinical and nonclinical teams create synergies that do more than promote access and positive outcomes for patients. Aligning teams around shared goals creates a workplace culture focused on process improvement, cross-functional learning, and organizational efficiency.

Imperative 4: Measuring Health Outcomes and Costs
Specialty pharmacies have long been required to demonstrate their ability to improve outcomes and reduce cost to be included in payer networks, earn referrals from prescribers, and obtain Limited Drug Distribution agreements from pharmaceutical manufacturers. Specialty pharmacies are also required to measure outcomes to maintain accreditation from leading health care accreditation agencies. Specialty pharmacies employ sophisticated software and tools to track response to therapy, monitor dosing, utilization, and adverse effects while tracking costs. These tools allow pharmacists to deliver data-driven interventions, reducing unnecessary hospitalizations or adverse events.

Data collected by specialty pharmacies drive value across stakeholder groups: patients better understand the benefits and outcomes of their treatment plan, prescribers receive a complete picture of response to therapy for a patient or group of patients, pharmaceutical manufacturers discern insights into the efficacy of their product, and payers develop deep insight into cost and cost drivers for high-dollar health conditions.

Imperative 5: Expanding Partnerships
Specialty pharmacies work with an array of stakeholders across the health care continuum to drive value. In a fragmented health care system, specialty pharmacies use these partnerships to promote continuity and facilitate a better understanding of patient-level needs and experiences across stakeholder groups. By expanding partnerships with each of the traditional health care stakeholders and developing relationships in new areas, including patient advocacy groups, government organizations, and a growing digital health industry, specialty pharmacies have significant opportunity to improve patient care, scale operations, and reduce complexity in the health care system.

Toward a Better Future
Porter affirms, “Value in health care is determined in addressing the patient’s particular medical condition over the full cycle of care, from monitoring and prevention to treatment to ongoing disease management.”4

Specialty pharmacies will thrive in the era of value-based health care because their business model is already firmly centered in creating value. As health systems, independent physician practices, payers, pharmaceutical manufacturers, and patients navigate this new environment, specialty pharmacies are uniquely positioned to lead as a valued, experienced member of a multi-disciplinary, multi-stakeholder team facilitating a shift to a paradox free, value-based healthcare system.

JUSTIN LINDHORST, MBA,
BioMatrix Specialty Pharmacy.
Published 10/2020 Pharmacy Times