News & Events

New Revenue Streams for Pharmacy Presented at ASAP by Don Dietz

PHSI Vice President Don Dietz presented at the American Society for Automation in Pharmacy (ASAP) 2018 Annual Conference.  Don discussed new revenue streams for pharmacies. Click here to view Don’s presentation slides. You can access all of the 2018 ASAP Annual Conference presentations at http://www.asapnet.org.

2018 Winter Newsletter- $4 Generic Lists: A Declining Proposition

Although discount generic lists were the centerpiece of many retail pharmacy advertising campaigns in the early 2010s, we rarely hear pharmacies tout their existence today.  Instead of being front and center on retail pharmacy webpages, discount generic lists are now embedded deeper within the websites, if listed at all.  PHSI first looked at the changing landscape of discount generic programs three years ago in our Winter 2015 Newsletter.  Since then, PHSI has continued to track the product offerings on these lists and noted decreasing or stagnant offerings.

Although generic drug pricing is currently in a deflationary period, pharmacy chains have not increased the number of products listed on their discount generic lists.  In the past, rising generic costs made the inclusion of many products unsustainable, but for many generics, this is no longer the case.  PHSI has tracked the discount generic programs of major pharmacy chains since 2012 and found that all chains have decreased the number of medications offered.  The chart below illustrates the annual changes in the number of included drugs.

Discount Generic Lists Chart

Walgreens still has the most robust generic drug program, with approximately 537 drugs included in 2017, while CVS has essentially discontinued their discount generic list.  CVS moved to a new “Reduced Rx Savings Program”, which only includes three Novolin insulin products.  While some pharmacy discount generic lists contain niche products, 124 drugs appear on all eight pharmacy lists.  These drugs are commodity generics and include meloxicam, metformin, lisinopril, amoxicillin, benazepril, citalopram, and clonidine, among others.  At acquisition costs of pennies per unit, these products can still provide modest revenue and a positive gross margin.

With the increasing prevalence of high deductible plans, we could see a rise in the popularity of discount generic lists.  High deductible health plans are forcing patients to become more price-driven in their search for pharmaceuticals, as flat-dollar copays are replaced in the deductible stage.  Stakeholders should expect patients in plans with a prescription deductible to behave more like cash-paying patients versus traditional commercially insured patients.  Competitive cash pricing will appeal to these patients.

Despite modest attention from patients in prescription deductible plans, will we see a resurgence in $4 lists?  PHSI’s answer… probably not.  While Walmart’s $4 list is an enticement to get patients into their stores, pharmacy chains do not make enough dollar profits on these programs to expand them.  Pharmacies analyze their PBM reimbursement rates when considering new candidates for discount generic lists or for eliminating current products.  With 90+% of drugs being reimbursed via third party insurance, pharmacies do not want to change their Usual and Customary (U&C) pricing to invoke the “lower of” clause in their PBM contracts, reducing the profitability on the vast majority of their prescriptions.  PHSI will continue to monitor discount generic drug lists and publish updates identifying changing market strategies.

 

2018 Winter Newsletter- 2017 New Drug Approvals

2018 Winter Newsletter- 2017 New Drug Approvals

2017 had the most drug approvals this decade, more than double the number approved in a disappointing 2016.  The FDA approved 46 new molecular entities and many other approvals for new indications, dosage forms, and formulations.  The following chart depicts the number of new drug approvals in recent years.

Novel Drug Approvals

Trends in Approvals

Oncology

Oncology is the therapeutic category with the most drug approvals in 2017.  The FDA approved 11 new drugs for different forms of cancer:  Aliqopa, Alunbrig, Bavencio, Besponsa, Calquence, Idhifa, Imfinzi, Kisqali, Nerlynx, Verzenio, and Zejula.

Neurology

Neurology increased from four in 2016 to seven in 2017.  The new medications for neurological conditions are Ingrezza for tardive dyskinesia, Austedo for chorea associated with Huntington’s disease, Brineura for Batten disease, Emflaza for Duchenne muscular dystrophy, Ocrevus for multiple sclerosis, Radicava for ALS, and Xadago for Parkinson’s disease.

Inflammatory Conditions

Two new treatments for plaque psoriasis, Siliq and Tremfya, and one treatment for rheumatoid arthritis, Kevzara, were approved in 2017.

Diabetes

Ozempic and Steglatro were approved for patients with Type 2 diabetes in 2017, up from one new drug approval in 2016 (Adlyxin).

PHSI analyzed the FDA approvals and categorized them by approval type, indication, and other factors, as shown in the following table.  PHSI identified drugs which were considered First-in-Class, and those that are Drugs for Rare Diseases, also known as orphan drugs.  2017 was a big year for orphan drugs, representing nearly 40% of new drug approvals.

PHSI segmented approvals by timing considered by the FDA including Fast Track, Breakthrough Therapy, and Accelerated Approval.  In some cases, more than one accelerated designation was employed to help bring the drug to market.

Specific Approval Types for 2017 Approvals (Final)

This article only contains new molecular entities approved in 2017.  To see all of the over 4,000 approvals that occurred in 2017, please visit the FDA’s Drugs@FDA website.

Sources:

U.S. Food and Drug Administration.  “Novel Drug Approvals for 2017.”  Last Updated January 11, 2018.  Available https://www.fda.gov/Drugs/DevelopmentApprovalProcess/DrugInnovation/ucm537040.htm.  Accessed January 11, 2018.

U.S. Food and Drug Administration Center for Drug Evaluation and Research.  “Advancing Health through Innovation:  2017 New Drug Therapy Approvals.”  January 2018.  Available https://www.fda.gov/downloads/AboutFDA/CentersOffices/OfficeofMedicalProductsandTobacco/CDER/ReportsBudgets/UCM591976.pdf.  Accessed January 11, 2018.

 

2018 Winter Newsletter- $4 Generic Lists: A Declining Proposition

ComputerTalk for the Pharmacist November/December 2017

PHSI President Tim Kosty and Vice President Don Dietz contributed to the November/December 2017 edition of ComputerTalk for the Pharmacist. In their Viewpoints article, Tim and Don identify a detailed list of the top 20 key pharmacy areas that would be opportunities for virtual reality training.

Click here to read Tim and Don’s article entitled “Training Support with a New Technology Solution”. You can read full versions of current and past ComputerTalk issues at http://www.computertalk.com/issue-archive.

2017 Fall Newsletter- PHSI Analysis of Authorized Generic Drugs

In the past year, there has been increasing interest in and awareness of Authorized Generics (AGs) by supply channel participants.  Several manufacturers have launched AGs before equivalent ANDA generics have been approved.  Despite the increasing prevalence of AGs, Pharmacy Healthcare Solutions, Inc. (PHSI) recently surveyed 200 pharmacists and uncovered that two thirds could not define an authorized generic.  This article should provide pharmacists with additional insights into authorized generics.

According to the FDA, an authorized generic is defined as “an approved brand name drug that is marketed without the brand name on its label. Other than the fact that it does not have the brand name on its label, it is the exact same drug product as the branded product.”  Authorized generics enable innovator manufacturers to sell their product via another NDC number as a generic.  The AG is sold at a different, lower price than the approved innovator (NDA) product.  Authorized generics are most commonly sold via their generic or chemical name, although they can also be sold as branded generics (e.g. oral contraceptives).

Authorized generics are made under the same process as the originator brand and generally have the same size, shape and markings.  Their inert components and excipients are also the same as the innovator, unlike ANDA generics.  A comparison of brand, AG, and ANDA drugs can be seen in the chart below.

Updated AG Chart

Because of their similarity to the brand product, substitution laws look favorably on AGs.  In its preamble[1], the FDA Orange Book states that:

“Any drug product in the Orange Book repackaged and/or distributed by other than the applicant (e.g., an authorized generic) is considered to be therapeutically equivalent to the applicant’s drug product even if the applicant’s drug product is single source or coded as non-equivalent (e.g., BN). Also, although not identified in the Orange Book, distributors or repackagers of an applicant’s drug product are considered to have the same code as the applicant.”

For states that use the Orange Book for generic substitution guidance or list it as a reference source, pharmacists should be able to substitute an AG for the innovator product, just like an A-rated ANDA generic drug would be substituted.

Pharmacists should remember that AGs receive the same Orange Book code as their innovator product.  Generally, this means that both the AG and innovator are A-rated.  Recently, however, AGs have been introduced for non-A-rated innovator products.  This can occur when AGs launch prior to the availability of an ANDA generic.  In this case, the innovator product would be “Not Rated”, or NR, and the AG would also receive a “Not Rated” rating.

A second scenario can occur when the innovator product is B-rated.  This happens when two brand products have been approved via the 505(b)2 process for the same active ingredient, strength, and route of administration.  Because both brand products are pharmaceutically equivalent but not bioequivalent, an Orange Book B rating is assigned to these brands, indicating that the brands are not interchangeable.  Because the innovator is B-rated, an AG launched to this product would also be B-rated.  According to state laws where the Orange Book is referenced, in these situations, the AG is still substitutable for its innovator product, as the AG is identical to the brand, innovator product, despite the B ratings.

An example of this can be seen with Mylan’s Epinephrine Auto Injector (NDC 49502-0102-02).  The innovator, EpiPen, is a BX-rated product to Adrenaclick (Amedra Pharmaceuticals).  Because EpiPen is BX-rated, its Mylan AG also has a BX rating.  However, the Mylan AG is still an appropriate generic substitute for EpiPen.  Because the EpiPen is BX-rated to Adrenaclick (Amedra Pharmaceuticals), the Mylan AG is not a generic substitute for Adrenaclick.   Anecdotally, we have heard of pharmacists concerned about dispensing the BX-rated Mylan AG for Mylan’s EpiPen because of the BX rating.

PHSI performed a review of all authorized generic agents listed in the Medi-Span drug compendia and found:

  • There are 852 unique AG prescription products listed. Based on multiple package sizes, this amounts to a total of 1,169 NDCs.
  • Of the 852 unique AGs, approximately 3% have branded generic names (e.g. Ocella, Lopreeza, DermacinRx), while the remaining 97% of products are chemically named.
  • Greenstone is the most frequently seen labeler in the AG space (242 AG NDCs), followed by Sandoz (154 AG NDCs), and then Prasco (106 AG NDCs).
  • Although not directly related to the purchase price, when looking at the current AGs in the market where the brand product is still active, the published WAC price is approximately 48% lower than the WAC price of the corresponding brand.

AGs provide alternative generic supply options for all stakeholders.  Pharmacy costs decrease for generics as the number of suppliers increase.  Patient satisfaction with generics may increase, as product appearance differences are minimized with an AG.

Although many benefits can be seen by using an AG, cost is often the deciding factor when pharmacies choose a preferred generic manufacturer.  When pharmacy chains use a wholesaler source program for purchasing, the wholesaler decides on the preferred generic. A preferred generic helps to ensure product uniformity across pharmacies in a chain and enables pharmacies and buying groups to negotiate competitive prices.  Authorized generics may be the preferred generic product if their manufacturer is the successful bidder.  Even if they are not the preferred generic, AGs may be a purchasing option in most wholesaler systems.  Interestingly, PHSI has found that most pharmacy dispensing systems do not flag products as authorized generics or have specific fields in their drug file that contains this information.

The recent awareness of AGs at a consumer level (epinephrine auto-injector AG and salmeterol/fluticasone inhaler) may lead to consumer inquiries about these products.  PHSI hopes that this overview will enable dispensing pharmacists to address questions and make informed product selection decisions when evaluating generic product options for their patients.

[1] United States Food and Drug Administration (FDA); Approved Drug Products with Therapeutic Equivalence Evaluations; 37th Edition; page 11; https://www.fda.gov/downloads/Drugs/DevelopmentApprovalProcess/UCM071436.pdf

 

2017 Fall Newsletter- Payers Stepping Up to Tackle the Opioid Epidemic

2017 Fall Newsletter- Payers Stepping Up to Tackle the Opioid Epidemic

Addressing the opioid epidemic is a key issue facing much of America.  President Trump recently stated that “this epidemic is a national health emergency.  As Americans, we cannot allow this to continue.”  To combat this epidemic will require a multi-faceted approach involving communities, law enforcement, prescribers, pharmacies, patients, and payers.  With stakeholders facing a heightened urgency to act, payers are increasingly looking for new ways to limit the overprescribing of prescription opioids.  In the past year, CVS Health, Express Scripts, Optum, and Cigna have all made recent statements and taken steps to limit patient access to opioid prescriptions.

The PBM CVS Health was the first to announce that they would limit opioid prescriptions to a 7-day supply for patients new to pain therapy.  Under the new plan, CVS will also limit the daily dose of opioids based on their strength and require use of immediate-release versions before extended-release options.  These benefit design changes will apply to CVS commercial, employer group, and Medicaid plans.

Express Scripts soon followed suit, limiting patients new to opioid therapy to a 7-day supply, regardless of the quantity prescribed.  Physicians prescribing an extended-release opioid to a first-time user will need to complete a prior authorization, incentivizing immediate-release product use first.  Similarly, the daily dose will be limited to 200 mg morphine-equivalent dose (MED), and prescribers wishing to have patients on higher doses will need to submit a prior authorization request.  The milligram-morphine-equivalent (MME) is a value assigned to a specific opioid to represent its relative potency, while the MED is the per-day sum of the MME potency score of all opioids a patient is prescribed.

Like the other PBMs, Optum is implementing a stricter program and limiting patients new to opioid therapy to a maximum of 49 MED per day.  New opioid patients can fill a maximum of two 7-day supplies within a 60-day period.  Non-cancer patients already taking opioids will be limited to a maximum of 90 MED per day with two fills in 60 days.

The American Medical Association is against the new PBM policies, with some physicians stating that the PBMs are “practicing medicine” and intruding on the doctor-patient relationship.  Other physicians welcome the monitoring, as they are unaware of patient relationships with multiple physicians and appreciate the oversight.  Although most physicians are appropriately monitoring opioid use, the new PBM plans will likely force other physicians to prescribe smaller quantity prescriptions for patients new to therapy.  Most importantly, the new PBM opioid plans have been shown to work.  Compared to the control group, an analysis of 106,000 patients enrolled in the Express Scripts pilot program showed a 38% reduction in hospitalizations and a 40% reduction in emergency room visits.

Many of the parties involved in addressing the opioid crisis are investing funds to curb abuse and address this societal issue.  Many pharmacies and physicians have already paid to integrate accessing Prescription Drug Monitoring Programs (PDMPs) into their software systems.  PHSI expects these PBM-set opioid prescription limits will become standard claims processing edits, but PBMs will likely recoup funds for processing any additional prior authorizations associated with the programs.

Cigna recently announced that they will stop covering OxyContin® prescriptions in “an attempt to reduce opioid use amid a nationwide abuse epidemic”.  This change applies to brand-name OxyContin.  No additional limits are placed on generic oxycodone or similar opioids.  Cigna recently signed a “value-based contract” with Collegium Pharmaceutical for Xtampza® ER, an oxycodone equivalent with abuse-deterrent properties.  Was this change made due to the lower street-value of Xtampza® compared to brand OxyContin?  Skeptics note this change appears to be financially and rebate-motivated versus a true patient-centered opioid reduction program.  It will be interesting to see decision outcome reports on Cigna’s change.

PHSI is hopeful that the new PBM quantity limits will curb opioid abuse.  These programs will not likely impact patients already on opioids at doses less than 200 mg MED/day, but will instead focus on new-starts.  With prescription opioids serving as gateway drugs, these new programs will hopefully prevent patients from escalating to heroin and other illicit substances.

 

2017 Fall Newsletter- PHSI Analysis of Authorized Generic Drugs

ComputerTalk for the Pharmacist September/October 2017

PHSI President Tim Kosty and consultant Ann Johnson contributed to the September/October 2017 edition of ComputerTalk for the Pharmacist. In their Viewpoints article, Tim and Ann discuss the barriers that Amazon will likely face when entering the pharmacy market, as well as some areas of opportunity to become successful in the market.

Click here to read Tim and Ann’s article entitled “Amazon: Pharmacy Disrupter or Tough Going”. You can read full versions of current and past ComputerTalk issues at http://www.computertalk.com/issue-archive.

Think Patients and PHSI Named PM360 Trailblazer 2017 Initiative Winners

Press Release

 

For Immediate Release

 

THINK PATIENTS AND PHARMACY HEALTHCARE SOLUTIONS, INC. NAMED PM360 TRAILBLAZER 2017 INITIATIVE WINNERS FOR THE EMR/EHR PROGRAM CATEGORY


[NEW YORK, NY, SEPTEMBER 14, 2017] — PM360, a publication for marketing decision makers in the pharmaceutical, biotech and medical device industries, recently named Think Patients and Pharmacy Healthcare Solutions Inc.’s “Supporting Pharmaceutical Manufacturers in the New Age of Digital Care” program as the Trailblazer Initiative “Gold Winner” in the EMR/EHR Program category.

The winning program, which was selected from among a group of three finalists in the EMR/EHR Program category, was recognized for outstanding achievement and marketing innovation.  To develop the “Supporting Pharmaceutical Manufacturers in the New Age of Digital Care” program, Think Patients and PHSI worked with pharmaceutical manufacturers and drug compendia organizations.  The service works to ensure pharmaceutical products are displayed clearly and appropriately in EMR/EHR systems for prescribers to view in the product selection step of the prescribing process.

Winners were honored during a special reception at Gotham Hall in New York City on Thursday, September 14, 2017.  After announcement of the award, Don Dietz, Vice President of PHSI said, “This exciting news is a true testament to our ability to stand out in the complex, ever-changing healthcare environment.  The judges looked at the EMR/EHR category nominated programs’ content, format, and success in reaching the targeted audience, overall quality, and results.  Think Patients and Pharmacy Healthcare Solutions Inc. (PHSI) thank their peers in the pharmaceutical and HIT industries for this recognition.  We are very proud of our work in this area, and are especially proud and appreciative of the work all of our colleagues have done to develop this service.”

Since 2009, the PM360 Trailblazer awards have recognized outstanding achievement and innovation in healthcare marketing. Each year, nominations are judged by the PM360 Editorial Advisory Board, a distinguished cross-section of industry experts. Winning initiatives were selected for their ability to stand out in the complex, ever-changing healthcare environment, and were judged on their ability to overcome challenges; the skill, innovation and quality of planning and execution; and the effectiveness of the work.

#  #  #

About PM360

PM360 is the premier, must-read magazine for marketing decision makers in the pharmaceutical, biotech, and medical device industries. Published monthly, PM360 is the only journal that focuses on delivering the full spectrum of practical information necessary for product managers and pharmaceutical marketing professionals to succeed in the complex and highly regulated healthcare environment.

The journal’s targeted and insightful editorial focuses on issues that directly impact critical decision making, including: Planning and implementation of cutting edge strategies, trends, the latest technological advances, branding/marketing, advertising/promotion, patient/professional education, sales, market research, PR, and leadership. Additionally, the “360” in the title signifies the span of this critical, how-to info with personal and career insights for an enjoyable and thought-provoking read.

By providing the full circle of enriching content, PM360 is truly an indispensable tool for busy and productive marketing professionals to stay at the top of their game.

 

About Think Patients

Think Patients is a marketing consulting and research company serving both pharmaceutical and vaccine companies and firms that supply these industries. Think Patients is proud of its deep experience in pharmaceutical and healthcare marketing with leaders and consultants that have spent their careers building and managing leading brands, developing game-changing products and services, and leading teams, franchises and companies to success.

Given our experience with patient education, direct marketing and data-driven communication, many people assume our name refers to a “patient marketing” company. And while we do assist clients in these areas, they are not the focus of our practice. Our name is simply meant to reflect our belief that great pharmaceutical, vaccine and healthcare marketing – like all great marketing – begins by thinking about the customer. And in these markets, that means thinking about the patient even when the immediate audience is physicians, payers, policy makers or patients.

 

About PHSI

Founded in 1996, Pharmacy Healthcare Solutions Inc. (PHSI) provides consulting solutions that improve the profitability of our healthcare clients.  PHSI clients are comprised of many worldwide pharmaceutical manufacturers including 5 of the top 10 pharmaceutical companies in the world by revenue.  PHSI also provides consulting support to a host of notable managed care organizations, pharmacies of all types, pharmacy benefits managers, and software companies. Consulting projects across these market segments provide PHSI with the latest information on emerging trends as well as new products and services.  Our experienced consultants create actionable recommendations for our clients’ challenging business issues.

Contacts:

PM360 :

Andrew Matthius

Senior Editor, PM360

646-300-8113

www.pm360online.com

 

Think Patients :

Joe Meadows

President, Think Patients LLC

484-200-7898

www.thinkpatients.com

 

Pharmacy Healthcare Solutions, Inc. :

Donald Dietz

Vice President, Pharmacy Healthcare Solutions, Inc. (PHSI)

412-635-4650

www.phsirx.com

 

A PDF version of the Press Release is available here.

ComputerTalk for the Pharmacist July/August 2017

PHSI President Tim Kosty contributed to the July/August 2017 edition of ComputerTalk for the Pharmacist. In his Viewpoints article, Tim explores the historical issues with DUR system configurations and suggest steps the industry needs to take to improve patient safety.

Click here to read Tim’s article entitled “Drug Utilization Alerts: Failures and Future Direction”. You can read full versions of current and past ComputerTalk issues at http://www.computertalk.com/issues-archive.

2017 Summer Newsletter- FDA Orange Book Added Identifier

FDA Orange Book Added Identifier

Prior to 2017, the FDA’s “Approved Drug Products with Therapeutic Equivalence Evaluations” (Orange Book) used the Reference Listed Drug (RLD) identifier for different uses, depending upon the market situation.  These uses included the RLD identifying the NDA or an ANDA (when the NDA was no longer marketed or other extraordinary situations) that would identify the product to compare for bioequivalence.  The RLD was also used as the standard for generics to use for pharmacokinetic testing when preparing for an ANDA submission.

In this scenario, when an ANDA was identified as the RLD, the FDA clarified which product prospective ANDA applicants should use for bioequivalence testing as the reference standard.  This change created new issues because the ANDA applicant knew which product to conduct their pharmacokinetic testing, but there was no longer a NDA to use as the basis of generic labeling.  This caused confusion for ANDA applicants because the RLD identifier was being used to determine the “reference standard” (RS), which may not have been the basis for product labeling.

In 2017, the FDA updated the Orange Book to split the RLD identifier into the two unique definitions.  The RLD now solely refers to the application and labeling aspect the ANDA applicant should reference. The RS determines the product to conduct the bioequivalence testing.  In many cases, the RLD and RS are the same product.  The separate identifiers can be used to clearly delineate the focus for the applicant’s labeling vs. the bioequivalence testing.

FDA Orange Book Examples May 2017

Januvia, a single source brand, depicts the scenario in the Orange Book where only the brand is listed and available.  Januvia is both the RLD and RS reference product.

Summer NL 1

Darifenacin (generic Enablex) demonstrates that the NDA will continue to be identified as the RLD and RS as long as it is marketed.

Summer NL 2

The RLD can identify a discontinued NDA product, while the RS can identify an active ANDA so the ANDA applicant can clearly determine the comparison application for labeling (RLD) and the comparison application for pharmacokinetic studies (RS).

This second scenario is found with Cefaclor oral suspension.  The active ANDA is the RS, and the discontinued NDA, Ceclor, is the RLD.  Prior to the FDA change in 2017, the ANDA would have been identified as the RLD instead of the discontinued NDA.

Summer NL 3

The reference standard (RS) in the FDA Orange Book is a new identifier on certain products and depicts which product the applicant should use for bioequivalence testing.  The new RS identifier is not currently found in the drug compendia, but must be referenced in the FDA Orange Book.  The RLD now is solely focused on identifying the product to reference the labeling.  ANDA applicants now have clarity from the FDA for labeling (RLD) and product source for pharmacokinetic testing (RS).

 

2017 Summer Newsletter- 2018 Drug Exclusion Lists