Biologic Products Approved as NDAs Transition to BLA

The Biologics Price Competition and Innovation Act of 2009 (BPCI Act) will require biologic products (which include insulin products and human growth hormones) to be regulated under the Public Health Services (PHS) Act as of March 23, 2020. These products are currently regulated under the provisions of the Food Drug & Cosmetics Act (FD&C Act) where new drug applications (NDAs) are used.  Under the PHS Act, a biologics license application (BLA) will be required.

In a 2018 statement, former FDA Commissioner Scott Gottlieb addressed the upcoming change, stating, “There are currently no approved insulin products that can be substituted at the pharmacy level. One reason is that it was hard to bring a substitutable generic insulin to the market under the conventional drug pathway. The biosimilar pathway should make this kind of competition more accessible. Once an interchangeable insulin product is approved and available on the market, it can then be substituted for the reference product at the pharmacy, potentially leading to increased access and significantly lower costs for patients.”

How will FDA transition these responsibilities? The agency developed a document called “The ‘Deemed to be a License’ Provision of the BPCI Act: Questions and Answers” to provide answers regarding its interpretation of the transition guidelines. The document also includes FDA’s compliance policy for labeling biological products that are subjected to BLA approval. The FDA proposes its “nonbinding recommendations” to create a set of standards to follow after the transition date. These preset guidelines will be used to deem approval of biological products under the FD&C Act for a license for biological products under the PHS Act. The FDA will be sending letters to holders of approved NDAs on March 23, 2020 to notify them the approved application will be “deemed to be a license” for the biological product on the transition date. Current NDA holders are still responsible for post-approval requirements.

The FDA released the “Preliminary List of Approved NDAs for Biological Products That Will Be Deemed to be BLAs on March 23, 2020” which has gone through multiple updates since its original release. The current version has been updated through December 31, 2019. Most recently, the update added three NDAs that now fall into the “biological product” category following an updated definition made by the Further Consolidated Appropriations Act, 2020. The current list contains approximately 95 NDAs set to transition to BLAs in March.

One consequence of the transition from NDAs to BLAs will be that drugs will lose their unexpired exclusivities when transitioning to biological products (with an exception of the orphan drug exclusivity).  Any 3 or 5 year exclusivity applied to an NDA- approved biological product will end at midnight on March 20, 2020. Of the nearly 100 products on the list, only 10 have an initial NDA approval date after March 2015. Newer products will likely feel the effects to a greater extent, as they lose out on years of exclusivity. Manufacturers with pipeline products approved via NDA but expected to transition to BLAs should have already evaluated the consequences of an NDA approval prior to March 23, 2020.

The goal of this change is to promote biosimilar entry to create competition and encourage lower cost options. Insulin products, which have been in the spotlight regarding patient affordability, make up over 25% of NDAs on the list. The FDA released draft guidance for industry in November 2019 to encourage development of biosimilar insulin products. Time will tell if biosimilar entry of these biological products deemed to be BLAs has the intended effect on pricing and availability.


Posted February 2020

Pharmacies to Face Unintended Consequence of Blues Plans Manufacturing Select Generic Medications

A recently published story in Axios highlights how 18 Blues plans are working together through their subsidiary, Civica Rx, to manufacturer select generic medications that are high priced and in short supply. Civica Rx initially focused on 14 high-cost hospital medications but is now hoping to expand to the retail space. While their efforts should be applauded to reduce costs for these plans and their beneficiaries, the mechanics of how this strategy is implemented are likely to bring unintended consequences to pharmacies.

Pharmacies rely on their wholesalers to contract with pharmaceutical manufacturers to secure best prices and a continuous supply of generic medications. It is unlikely that all the major wholesalers will secure the lowest price for these target generics from Civica Rx. If pharmacies purchase directly from Civica Rx, there are volume and dollar thresholds that may not be maintained with wholesalers for the balance of pharmaceuticals purchased. The cost of other generics and brands may increase if these select generics are purchased from Civica Rx, and rebate thresholds cannot be met.

Health plans and PBM’s typically do not place manufacturer specific requirements on FDA A-rated generics, so it is incumbent on the wholesalers to purchase the lowest cost generic product for their pharmacy customers. If the Blues plans require use of Civica Rx products on their formularies, pharmacies have at least two choices. If the Civica Rx products truly have the lowest net cost, pharmacies may switch their entire inventory to the new, lower-cost Civica Rx product.  Otherwise, bifurcating purchases and inventory based on payer preference for otherwise equivalent, A-rated generics would increase inventory carrying cost for pharmacies and increase efforts to order and maintain product in a busy environment with limited shelf space. Finally, competition from Civica Rx may result in the manufacturers of these high cost, short supply medications lowering their acquisition costs to remain competitive in the market removing the incentive for pharmacies to switch.


Posted January 2020

Will New Packaging for OTC Loperamide Curb Abuse?

The FDA has approved packaging changes for the brand-name and generic over-the-counter (OTC) tablet and capsule formulations of loperamide (Imodium, Johnson & Johnson). Loperamide is indicated for use as an antidiarrheal but is often abused.  Loperamide acts on opioid receptors, and at higher doses, it can help treat symptoms of opioid withdrawal or can cause the euphoric effects of opioid use. Loperamide is available in 2 mg tablets and capsules. The maximum approved daily dose for adults is 8 mg/day as an OTC product and 16 mg/day for prescription use. When loperamide is abused, it heightens the risk for cardiac events such as QT interval prolongation, arrhythmias, syncope and cardiac arrest. The changes to Imodium A-D, Imodium Multi-Symptom Relief, and Be Health Loperamide HCl Capsules limit each carton to no more than 48 mg of loperamide (24 tablets or capsules) and requires unit-dose packaging of the tablets and capsules in blister packs.

The FDA worked with manufacturers to authorize package size limitations and unit-dose packaging for OTC loperamide products. The changes were implemented in hopes of deterring customers who inappropriately use this medication. The FDA believes there is evidence to support the alteration in package size and the unit-dose packing to decrease the number of medication related overdoses and deaths. Pharmacies are still able to sell this medication as an OTC, therefore, the average consumer who takes this medication as an antidiarrheal will not face any obstacles due to the changes.

Through 2015, the FDA received reports of 48 cases of serious heart problems associated with use of loperamide. Additionally, data from U.S. poison control call centers indicate that calls have increased for intentional loperamide exposures at a faster rate since 2010. With this change in packaging, pharmacists and pharmacy technicians need to have an increased awareness of large volume purchases or a sudden spike in sales of this product to identify potential loperamide abuse.  While limiting package sizes by the FDA is a reasonable first step, patient safety concerns may warrant the need for states to regulate individual sales. If this trend continues, retail pharmacies will need to consider updating their POS systems to require counseling on OTC loperamide sales.  In addition, retailers will need to implement system enhancements if OTC loperamide transactions require a monitoring process like the process used for pseudoephedrine.  What other impacts could the loperamide packaging change have?  What other patient safety actions are warranted for loperamide?


Posted January 2020

ESI Launches Digital Health Formulary

In December 2019, Express Scripts (ESI) announced the launch of their Digital Health Formulary, which went into effect January 1, 2020.  To develop the formulary and choose which products to include, ESI reviewed clinical research, evaluated member experience and product usability, and analyzed the financial value of each product.

ESI lists the following as their Digital Health Formulary:


As apparent in the chart above, the number of on-formulary products is limited.  Those included only treat a small range of diseases including diabetes, cardiovascular, pulmonary, and mental health conditions.  Noticeably absent from the formulary are several high-profile digital health products, specifically those mentioned on the Digital Therapeutics Alliance (DTA) website.

The DTA is a trade association with a mission to “broaden the understanding, adoption, and integration of clinically-evaluated digital therapeutics into healthcare through education, advocacy, and research.”  The organization established digital therapeutics foundational principals and Industry Core Principles.  DTA members include Bayer, American Association of Diabetes Educators, Boehringer Ingelheim, Headspace, Otsuka, Novartis, Sanofi, and other.  Members have developed products aligning with the Industry Core Principles, and case studies for these products are published on their website.  Products include WellDoc’s BlueStar, Voluntis’ Insulia, and Propeller Health’s Propeller.  Of these three digital therapeutic products, only one, Propeller Health, is included on the ESI Digital Health Formulary.  Other digital therapeutic products notably absent from the ESI formulary include Pear Therapeutics’ reSET and reSET-O, intended to treat Substance Use Disorder (SUD) and Opioid Use Disorder (OUD), respectively.

The publication of ESI’s Digital Health Formulary raises as many questions as it answers.

  • What were the specific reasons why the limited products were approved?
  • What other products were evaluated but not included?
  • If products were not placed on the formulary, were the reasons primarily clinical, humanistic, or financial?
  • Will ESI eventually publish a Digital Health Exclusion list similar to their Formulary Drug Exclusion List?
  • What is the expected growth rate of the Digital Health Formulary and how many products will be evaluated and/or added in 2020?
  • How will other PBMs react to this Digital Health Formulary and is this something we should expect to see from CVS Caremark and OptumRx in the future?

While the answers to these questions are not yet known, a major payer’s publication of a Digital Health Formulary clearly indicates a shifting industry mindset.  Obtaining formulary coverage for digital health products is just the first hurdle in the market.  With coverage now available for some digital therapeutic products, it is more important than ever that manufacturers have their products accurately listed in the drug compendia databases to enable physician e-prescribing and ordering through EMRs and EHRs.

PHSL offers a full range of drug compendia services and is experienced in evaluating digital health product labeling and assisting manufacturers with getting their products accurately listed in the drug compendia systems.  If payer coverage is the first hurdle, EHR listings and e-prescribing are the second hurdle in product uptake.  PHSL is well situated to address these hurdles and help providers of digital health products.  Let us know how we can assist your company in meeting your digital health goals!


Posted January 2020

Aspirin Knowledge Quiz

The National Community Pharmacists Association (NCPA) recently released a quiz assessing healthcare provider knowledge about the use of aspirin in primary and secondary prevention of heart disease.  For pennies a day, aspirin can lower the risk of a heart attack or stroke.  Test out your knowledge to see how much you know about the drug and its uses: Take the quiz!


Posted: December 2019

An Overview of Haven Healthcare

A healthcare partnership between Amazon, JPMorgan, and Berkshire Hathaway was first announced in January 2018 and formally named “Haven” in March 2019.   We have previously noted that with Amazon’s foray into healthcare, including the PillPack acquisition, Amazon could grow its business through a PBM acquisition (  The Haven model does not seem to include such an acquisition, but the “simplified medical plan” will include a prescription drug benefit with flat copays.  Cigna and Aetna will run the plans in Ohio and Arizona.

Knowing Amazon’s history in other market segments, Haven’s first health insurance plan offering could disrupt the current healthcare market.  The Haven Healthcare plan will be offered in 2020 to US employees.  Amazon will pilot the program with employees in CT, NC, UT, and WI, and JP Morgan Chase with employees in OH and AZ.  The joint venture may have clinical and technology employees based in both Boston and New York.

The plan features free preventive care, no coinsurance or deductibles, flat copays for visits to in-network providers (ranging from $15 to $110), and flat-fee fixed copays for medical services, procedures, and prescription drugs, along with annual out-of-pocket maximums.  Will these apparently rich benefits create an adverse selection amongst employees?

The goals include making primary care easier to access for employees, simplifying insurance benefits, making prescription drugs more affordable, and using data and technology to improve healthcare.

In addition to these stated goals and features, Amazon’s PillPack may benefit from being able to offer prescriptions directly to the employee members.  While these features and goals sound impressive, it remains to be seen whether Haven Healthcare can actually break into the complex health insurance market.


Posted December 2019

Unapproved Products and the Drug Pricing Compendia

Most medical foods, nutritional supplements, dietary supplements, probiotics, and multivitamins are considered unapproved products according to the Food and Drug Administration (FDA).  The FDA defines dietary supplements as “products taken by mouth that contain a ‘dietary ingredient’. Dietary ingredients include vitamins, minerals, amino acids, and herbs or botanicals, as well as other substances that can be used to supplement the diet.”  While the FDA requires prescription drugs to meet safety, efficacy, and quality standards, these same requirements are not in place for the aforementioned products.  Unlike prescription drugs, dietary supplements are not intended to treat, diagnose, cure, or alleviate the effects of diseases.

Knowing that the same rigorous standards are not applied to dietary supplements, many wonder how the drug compendia providers handle these products.  Drug compendia subscriptions are purchased by numerous stakeholders, including PBMs and health plans, who rely on this information to make formulary coverage decisions.  In an effort to provide their customers with the needed information, compendia publish specific fields to distinguish between prescription, OTC, and unapproved products.

First Databank (FDB) may mark these products as ‘Other’ in the “Rx/Non-Rx Indicator” field, while Wolters Kluwer’s Medi-Span has the “Marketing Category” field to specify whether a product is an “unapproved homeopathic”, “unapproved other”, “medical food”, or “dietary supplement”, among others.  Elsevier Gold Standard uses the “License Type Name” field to list some products as “dietary supplements” or “medical foods”.  Although Cerner Multum is not as granular in their identification, most unapproved products can be identified by searching the “nutritional products” or “alternative medicines” categories.

As payers focus on additional ways to reduce spend, eliminating coverage for unapproved products is an increasing area of focus.  In PHSL’s fall newsletter on 2020 Formulary Exclusion Lists, we found that CVS is making a strong push to exclude high cost dietary supplement agents, with 25 additional dietary supplements excluded in 2020.  To aid in identification of these unapproved products, FDB has announced the addition of a “Q” code to their existing Class value field.  The already existing Class values of “F” and “O” will remain.  “F” will designate prescription drugs and medical devices as defined in the Food Drug and Cosmetic Act, including bulk drug ingredients.  “O” drugs will include non-prescription drug or medical devices.  FDB will create a new “Q” Class value for “products that are neither drugs nor devices, such as dietary supplements (including prenatal and other vitamins), medical foods, herbal preparations, and bulk flavorings or colorants.”  This change will enable stakeholders to more easily identify unapproved products, but what to do with this information remains at the discretion of the FDB customer.  Medi-Span has not announced a corresponding update to their drug compendium, but PHSL will continue to monitor for new developments on this topic.  PHSL can assist manufacturer clients in assessing their current product portfolio and helping to determine potential impact.


Posted: December 2019

PHSI’s David Schuetz Named NCPDP Work Group 2 Product Review & Billing Unit Exception Task Group Co-Lead

PHSI’s Senior Consultant David Schuetz will be an NCPDP WG 2 Product Review & Billing Unit Exception Task Group Co-Lead.

Work Group 2 Product Identification

This work group deals with issues relating to the identification of drugs and health related products within NCPDP’s stated mission. Identification consists of how the product is billed (billing units, package size designations), product identification systems, and any type of descriptive data which serves to uniquely identify a product with the intent to establish standards for product identification such that there is no ambiguity in distinguishing one product from another.

Product Review and Billing Unit Exception Task Group

This task group will review and analyze all drugs that are exceptions to the Billing Unit Standard (BUS) to determine how each should be categorized for billing and document within the BUS. Package Size discrepancies among the compendia will also be addressed. They will request submission of QUIC forms when appropriate and will review all QUIC Forms received prior to the WG meetings.

Dave is one of the numerous volunteers that contribute each year to the development of NCPDP’s standards and provide direction to pharmaceutical manufacturers as they plan to launch new products.  We congratulate him and wish him well in this leadership role.


Posted November 2019

Payer/PBM Owned Specialty Pharmacies…The Next Frontier for 340B

340B eligible hospitals and health systems have realized that many of their patients are not allowed access to their specialty pharmacies, due to plan sponsors (employers/health plans/PBMs) having an exclusive arrangement with the plan sponsors’ specialty pharmacies. To resolve this issue, 340B covered entities are now partnering with the big PBM/payer-owned specialty pharmacies; in exchange, the 340B covered entity adds these specialty pharmacies as a contract pharmacy in their 340B network.

Due to the economic incentives provided to 340B covered entities to support underserved patients, specialty pharmacies within their 340B network stand to make more margin than they may from typical commercial plan reimbursements. The 340B covered entities obtain access to discounted specialty pharmaceuticals and increase pharmaceutical manufacturers’ exposure to 340B discounts. These arrangements have grown dramatically in the last three years.

While more commercial and Medicare Part D lives fall within the 340B program, pharmaceutical manufacturers are heavily discounting more medications AND paying formulary rebates.  This raises the question: how many commercial PBMs/payers are sending rebate claims for patients that are treated at pharmacies within the 340B covered entity network?  While most pharmaceutical manufacturer agreements require commercial payers to exclude 340B prescriptions from their rebate submissions, identifying these claims can be difficult.  If these claims are not identified correctly, pharma will be double dipped, providing discounted medications and paying rebates.

Pharmaceutical manufacturers’ 340B discounts are exploding.  The high cost of specialty drugs and the discounts required through the 340B program provide an incentive for the hospital, pharmacy, and PBM/payer to want more of these types of pharmacy claims.  As a result, pharmaceutical manufacturers are going to respond to declining revenue and specialty medication profitability by increasing prices on existing medications and factoring these increases into specialty medication launch prices.

The current NCPDP claim standard would allow PBMs and payers to require that the covered entity’s facility ID, prescriber’s NPI, and pharmacy’s NCPDP number be submitted during the claims adjudication process to triangulate whether a claim is associated with the 340B program. These same data elements should be included in the rebate claims submission files sent to pharmaceutical manufacturers.  Industry stakeholders should address the shortcomings of the 340B program to help ensure this program does not excessively enrich covered entities, pharmacies, and PBMs/payers, but rather supports patients who cannot afford adequate insurance coverage.


Posted: November 2019

October Drug Take-Back Day

Mark your calendars for the 18th National Prescription Drug Take-Back Day on October 26th, 2019 from 10am-2pm! In 2018, 9.9 million Americans misused prescription pain medications, most often taking medications from a family member. This event is an opportunity for people to safely and easily return unused or unwanted medications to help prevent these substances from getting into the wrong hands.

There are exceptions to what medications can be returned. Do not bring illicit drugs, such as marijuana, heroin, or LSD. Insulin syringes and inhalers are also not accepted at take back locations, due to an unintended puncture or possible explosion risk.

Accepted medications include prescription medications, over-the-counter medications, supplements, and herbals in tablet, capsule, ointment, or patch form. Liquid medications may not be accepted at all locations. Removing personally identifiable information on prescription bottles is recommended but is not required.

Visit to find a location site near you and learn more about Drug Take-Back Day.

If you cannot make it to the scheduled event, use the DEA’s collection site locator to find approved disposal locations in your area year-round.


Posted October 2019