News & Events

Medicare Part D coverage for prescription drugs is a federal program that is administered via private entities.  Each approved Medicare Part D plan must offer at least a standard level of coverage.  The list of covered drugs, or formulary, must include at least 2 drugs in the most commonly prescribed categories and classes.  United States Pharmacopeia (USP) works in concert with the Centers for Medicare and Medicaid Services (CMS) to provide and regularly update the specific set of drug categories and classes, known as the Medicare Model Guidelines (MMG).  This provides Medicare Part D plans one option to follow to determine the required covered classes to offer to Medicare beneficiaries.  Medicare Part D plan sponsors also have the option to create their own drug classification listing that must be approved by CMS prior to implementing.

The previous version of the drug categories and classes, called the Medicare Model Guidelines version 8 (MMG v8.0), was published in 2020.  USP released a draft of the updated version 9 document in June 2023.  The draft Medicare Model Guidelines version 9 (MMG v9.0) are intended for use September 15, 2023. The new version includes additions, changes, and removals that have been made to the guidelines.

Class Additions:

Version 9 saw several class additions, with one new class being “Calcitonin Gene-Related Peptide (CGRP) Receptor Antagonists,” which is under the “Antimigraine Agents” category. Under the category “Cardiovascular Agents,” USP added the classes “Mineralocorticoid Receptor Antagonist” and “Sodium-Glucose Co-Transporter 2 Inhibitors (SGLT2i).”  Assuming no changes when the final version is revealed, plans will be required to cover two drugs from each of these classes moving forward.

Along with the changes mentioned above, many new drugs have been FDA approved since the release of MMG v8.0. Twenty new FDA approved drugs were added into the class “Molecular Target Inhibitors.” This number of additions to an already highly populated class is unique, but due to the use in oncology, plans will likely not limit coverage for most of these drugs. Two of the new classes added in this version, “Mineralocorticoid Receptor Antagonist” and “Sodium-Glucose Co-Transporter 2 Inhibitors (SGLT2i)” only contain 3-4 example drugs.  Plans could seize this new opportunity to limit coverage to two drugs in each of the classes, generating competition for formulary position.

Some newly approved drugs have been placed into more general classes that are described as “Other.”  There is the possibility of USP adding additional classes to offer more specificity for these new drugs in the final guidelines.  If additional classes are added, certain drugs may benefit by being the only product or a pair of products in the class.  In this potential scenario, these drugs would likely gain broad coverage from Medicare Part D plans without offering the level of rebates found in highly competitive classes. In contrast, if these drugs remain in the general “Other” class, they may not gain coverage as broadly among Medicare Part D plans.

Class Changes:

The class known in version 8 as “Gamma-aminobutyric Acid (GABA) Augmenting Agents” had a verbiage change to “Gamma-aminobutyric Acid (GABA) Modulating Agents” for version 9. Changing these terms depicts the agents as having a controlling influence on GABA, which more closely fits the actions of the example drugs.

In draft version 9, two previous categories, “Hormonal Agents, Suppressant (Adrenal)” and “Hormonal Agents, Suppressant (Pituitary),” were combined by USP into one category named “Hormonal Agents, Suppressant (Adrenal or Pituitary).” This change would combine more drugs into a single category, allowing plans more discretion to make formulary coverage decisions.

Drug Recategorization:

Along with updating drug categories and classes, USP also adjusted the placement of certain drugs within the existing structure and are shared in the following table.

Watch for the official final release of the Medicare Model Guidelines version 9 in September 2023.  These changes impact manufacturers and Medicare Part D plans regarding formulary coverage and competition.

Posted August 30, 2023

Fall 2023 Newsletter:

FDA Novel Drug Approval Trends

Prescription drugs must be approved by the United States Food and Drug Administration (FDA) before entering the market. Each year, the FDA’s Center for Drug Evaluation and Research (CDER) and Center for Biologics Evaluation and Research (CBER) approve a wide range of new drugs and biologics. These products can either be drugs that have never been used in clinical practice before or drugs that are similar to previously approved products. As of 8/25/2023, the FDA has approved 35 drugs. This is almost the same number of drugs approved in all of 2022!

Although it seems there is a recent increase in drug approvals this year compared to 2022, the current trend of 2023 is on par with the past five years, excluding 2022. The table below shows data from the past five years of novel drug approvals from the FDA.

There is not a clear reason why there were significantly fewer approvals in 2022. However, there is speculation that it has to do with 2021 controversies that led to a more stringent approval process. When a drug is rejected, the FDA does not publish the complete response letter (CRL) and leaves the disclosure of the FDA’s response up to the applicant. The FDA does not publish figures for rejected applications. Theoretically, the decrease in approvals in 2022 could be due to more drug application rejections than normal.

Even with fewer drug approvals in 2022, the percentage of drugs approved using an expedited development pathway is similar to previous years. The four main pathways to expedite a drug’s review and/or approval are as follows:

• Fast Track – Facilitates the development and expedites the review for drugs treating serious conditions with an unmet medical need.
• Breakthrough Therapy – FDA expedites the review process for drugs that demonstrate substantial improvements over available therapies.
• Priority Review – FDA implements a goal to review and take action on the application within 6 months vs. 10 months for a standard review.
• Accelerate Approval – Drug approvals serious conditions with an unmet medical need may be approved based on a surrogate endpoint.

The manufacturer of a single product may request review/approval via multiple pathways above. Until the complete counts are shared, it is difficult to assess the FDA approval trends based on these pathways.  With that being said, the products that have been approved do not focus on one disease state or area of practice. The drugs approved in 2023 treat a variety of diseases ranging from common diagnoses like migraines to rare diseases like Fabry disease. However, rare diseases are becoming a growing target for drug development.

How do you think these trends will continue or change over the next five years?

Posted August 30, 2023

Fall 2023 Newsletter:

Get Ready: Medicare Model Guidelines Version 9 Are Coming

PHSL Vice President Melissa Krause and Director of Business Development Karlo Zovko will be attending the National Association of Specialty Pharmacy (NASP) 2023 Annual Meeting & Expo on September 18-21 at the Gaylord Texan Resort & Convention Center in Grapevine, Texas. According to NASP, the annual meeting offers 45 education sessions and six workshops.

To schedule a meeting with Melissa and Karlo during the conference, click here to contact PHSL.

PHSL President Ann Johnson and Director of Business Development Karlo Zovko will be attending AMCP Nexus 2023 in Orlando, Florida on October 16th-19th. According to AMCP, the conference is expected to attract over 3,000 attendees, and will include 34 education sessions and over 75 exhibitors.

To schedule a meeting with Ann and Karlo during the conference, click here to contact PHSL.

PHSL Consultant Alan Sekula contributed to the May/June 2023 edition of ComputerTalk for the Pharmacist. In his Viewpoints article, Alan provides an overview of the Maximum Fair Prices determined by the Medicare Drug Price Negotiation Program and discusses considerations for pharmacies as they prepare for implementation.

Click here to read the article “What You Need to Know About Maximum Fair Prices.” You can also access the full versions of current and past ComputerTalk issues at https://www.computertalk.com/issue-archive/.

In March 2023, Lilly, Sanofi, and Novo Nordisk all announced that they will be lowering prices for several of their key insulin products.  To accomplish these price reductions, the three manufacturers have announced list price cuts ranging anywhere from 65% to 78%.  This news comes on the heels of the January 2023 introduction of the Inflation Reduction Act, which capped insulin out-of-pocket costs at $35 for Medicare beneficiaries.  This news also comes two years before the Medicare drug price negotiation program, which is slated to begin in 2026 and where insulins have the potential to be a drug included in negotiations. Another driving force for this change could be the American Rescue Plan Act of 2021, which removed the cap on rebates that manufacturers pay to Medicaid.  By proactively lowering prices now, insulin manufacturers may eliminate the risk of paying greater than 100% of AMP for Medicaid patients.

What Insulins are Included in the Price Cuts?

Based on a Novo Nordisk press release, “cutting the list price” seems to be equated with lowering the products’ Wholesale Acquisition Cost (WAC).  Using the publicly released price reduction percentages from each of the three manufacturers, PHSL predicts that the new WAC prices for key insulins will be as illustrated in the following table; however, PHSL notes that these newly anticipated WAC values are based on the current WAC values, and do not take into account any manufacturer price changes that could occur prior to the implementation.

Who Decides Which Insulin Prices to Cut?

While there have been various legislative and policy changes driving this concept, as with all drugs, it is ultimately up to the individual manufacturer to decide how to price their products. The insulin products noted in PHSL’s table are those that have been publicly stated as having price reductions applied. The manufacturers included in this list may or may not choose to reduce prices of their other insulin products. Other manufacturers may choose to reduce prices of their insulin products in the future.

Out-Of-Pocket Costs

The Inflation Reduction Act had already capped insulin out-of-pocket costs at $35 for patients with Medicare.  However, in addition to reducing the list price of their insulin products, Lilly has also announced that they will cap insulin out-of-pocket costs for commercially insured patients at $35, when prescriptions are filled at participating retail pharmacies.  Sanofi has pledged to do the same for Lantus.  Since manufacturers cannot dictate how payers set their patient copay amounts, how this will be operationally implemented for commercially insured patients has not yet been determined.  PHSL suspects that manufacturers may use e-vouchers to accomplish this.

The Improving Needed Safeguards for Users of Lifesaving Insulin Now (INSULIN) Act of 2023 was recently introduced in the U.S. Senate on April 20, 2023.  If passed, the bill would require health plans to cap out-of-pocket insulin costs at $35 for commercially insured patients in 2024.  In 2025, out-of-pocket costs would be calculated as the lesser of $35 or 25% of the list price for a 30-day supply.  With the newly lowered list prices from Lilly, Sanofi, and Novo Nordisk, 25% of the list price would often fall below the $35 threshold.  The bill indicates that pricing would need to apply “for at least one insulin of each type,” but how an insulin type is defined (i.e., long acting vs. short acting, unique active ingredient, etc.) is unknown.

Price Cut Implications

With most of the price cuts going into effect in 2024, PHSL would expect that manufacturers reduce or eliminate rebates for these insulin products.  For payers who have a large population of patients with diabetes and who rely heavily on rebates, a decrease in rebate dollars should be planned for and expected in the 2024 plan year (although the decrease in rebates is likely to be at least partially offset by lower plan paid costs upfront).

From a patient perspective, those with high prescription deductibles will benefit the most.  Once deductibles are met, commercially insured patients likely have copays at or below $35 today, and copay cards are prevalent for the above-mentioned insulin products.  For uninsured patients, Lilly, Novo Nordisk, and Sanofi all offer patient assistance programs or savings programs.  Thus, PHSL does not expect that the new price changes will have a significant impact on patient costs, except for those with high deductibles.  What are your thoughts on the newly announced insulin price reductions?  How will the price decreases impact industry stakeholders?

Posted May 16, 2023

Spring 2023 Newsletter:

Cutting Through the Online Noise – Social Listening: What Is It and How Can Pharma Benefit?

Have you been noticing the recent online chatter about weight loss drugs?  It is difficult to ignore!  That online chatter and the power of social media influencers have created unexpected market upheaval, including regional drug shortages and patients unable to secure their needed medication. Whether it is social media sites, apps, a favorite online influencer, or your trusted health site, someone is providing information, accurate or otherwise, or opinions about your product.

PHSL recently assisted a major pharmaceutical company in performing a robust dive to identify and monitor sites that present that manufacturer’s product information to healthcare professionals and consumers.  This is social monitoring. PHSL analyzed this information to determine why it was being presented to healthcare professionals and consumers. This is social listening. Monitoring is what is being said and where. Listening is analyzing to determine the why.

Social media has become an untapped wealth of information that should be monitored and analyzed.  It provides vital information, such as opinions and promotions of consumers online, which cannot be found in traditional data sources. Social listing can allow for the discovery of inaccurate, missing, and potentially dangerous product information in these sources.

Research

Manufacturers can use social listening to better understand the opinions of their products, address any negative opinions, and stay ahead of the curve by being the first to recognize trends in the industry, which may drive unanticipated financial and regulatory issues.

It is common for people to consult social media whenever they are faced with a health issue. A recent study published in the Journal of Medical Internet Research looked at inflammatory bowel disease (IBD) social media posts; over 55% of the posts included in the study were related to medication advice, beliefs about safety of IBD medications, personal experiences with medication use, or fears or anxieties about the safety of IBD therapies.  Manufacturers who are aware of specific concerns would be able to set themselves apart by addressing such concerns.

Manufacturers who utilize social listening would also be able to understand and respond to some of the buzz surrounding their products.  Take metformin, for example; nearly all healthcare professionals think of diabetes whenever metformin is mentioned, yet there is intrigue coming from Americans consumers concerning off-label uses of the drug, none of which have anything to do with diabetes.  This interest is fueled by information shared on Tik-Tok, Instagram, and health-focused blogs. Social media influence has created an enormous demand for drugs that are commonly used for the treatment of diabetes or obesity, in an effort to lose weight. Hashtags of various drug names have blown up on social media. One drug hashtag has over 600 million views and counting.

FDA and Social Media

Did you know even the FDA performs widespread social monitoring and listening?  One way the FDA is harnessing the power of social listening is to monitor and track drugs of concern.  Paula Rausch, the Associate Director of Research and Risk Communications in CDER’s Office of Communications, says the “CDER has begun to use nontraditional sources to explore the social contexts in which substances are being used, as well as to identify potential drugs of concern that may be emerging. These data can provide clues about the dynamics of use, misuse, and abuse, and potentially identify changing patterns.”  The FDA is currently monitoring more than 95 million online and social media sites.

More information on the FDA’s process can be found here.  FDA has issued guidance on social media content and a summary can be found here.

Pharmaceutical Social Monitoring and Listening

Actionable market insights are expanded through the inclusion of social monitoring analytics. Evaluation of current and future marketing strategies should incorporate the potential market dynamics of social media. Product information presented on professional, industry, and consumer-driven sites may have an effect on production and product availability planning. Off-label claims and other regulatory or legal issues may be identified as having the potential to skew current market analysis.

What exactly is the role of social listening in the pharmaceutical industry?  It seems prudent for a manufacturer to identify and monitor high-priority web sites that may publish incorrect or incomplete information about their product, especially as the FDA is also monitoring these sites.  This is important so that healthcare professionals and patients have access to the most complete and accurate product information. The results of a social listening analysis provide manufacturers with the knowledge to understand the opinions, both positive and negative, around their products on professional and patient healthcare locations.

Getting Started

The exponential growth of social media, relevant websites, and healthcare apps will only continue. Social listening can uncover invaluable information, but it is often difficult to know where to start and what to do with the findings. The different types of information retrieved must be efficiently and accurately categorized into insightful information, which can be analyzed to ultimately create the greatest benefit.  PHSL can assist in the identification and selection of online listening sites in alignment with your company’s strategy, followed by the analysis and recommendations for mitigation if necessary. Trend analysis can be performed over time for newly launched products, high-priority, or high-risk products. PHSL can focus on disease-specific or professional practice sites.

PHSL has experience helping manufacturers engage in social listening and providing strategic recommendations based on our findings.  Let us know if we can help!

Posted May 16, 2023

Spring 2023 Newsletter:

Insulin Price Cuts – What’s Included and What’s Not

PHSL Consultant Alan Sekula contributed to the January/February 2023 edition of ComputerTalk for the Pharmacist. In his Viewpoints article, Alan discusses components of the Inflation Reduction Act related to pharmacy and prescription drugs, including negotiated prices, price increase greater than inflation, benefit design and premium maximum increase, vaccine coverage, biosimilar reimbursement, and insulin payment cap.

Click here to read the article “The Inflation Reduction Act Impact on Prescriptions.” You can also access the full versions of current and past ComputerTalk issues at https://www.computertalk.com/issue-archive/.

It’s back…PHSL’s annual review of the big 3 PBM formulary exclusion list updates! Express Scripts (ESI), CVS Caremark, and OptumRx published their formulary exclusions for January 2023. Based on PHSL’s review, OptumRx leads the way with over 77 new formulary exclusions. ESI added 36 new exclusions, while CVS Caremark only excluded an additional 26 drugs. Although CVS Caremark excluded nearly 30 new drugs, they anticipate that 99.72% of their clients will not be impacted by any medication changes because of these formulary removals. The January 2023 exclusions, as researched by PHSL, are as follows:

During the review, PHSL made the following observations:

• ESI focused more attention on anticonvulsant agents. Examples of exclusions in this category include Banzel, Onfi, Klonopin, and Vimpat.
• CVS Caremark’s focus was on chemotherapy agents, such as Rubraca, Sutent, and Alimta.
• OptumRx focused on autonomic and central nervous system agents. Specific agents excluded by OptumRx are Daytrana, Ponvory, and Quillichew ER.
• All three PBMs excluded numerous respiratory products. CVS Caremark excluded Flovent Diskus, instead preferring Flovent HFA or Pulmicort Flexhaler. OptumRx excluded generic fluticasone-salmeterol products in favor of Advair Diskus, likely due to rebates.  OptumRx also excluded Dulera, Incruse Ellipta, Tudorza, Bevespi, and QVAR Redihaler.  Like OptumRx, ESI excluded Incruse Ellipta and Tudorza Pressair in favor of Spiriva.  Although many of these changes are likely rebate driven, from a clinical perspective, the Global Initiative for Asthma (GINA) guidelines were also updated in 2022 and now seem to generally prefer the combination of formoterol paired with an inhaled corticosteroid when an inhaled corticosteroid is prescribed.
• Both OptumRx and ESI excluded the Glucagen Hypokit for 2023, while the product was already excluded by CVS Caremark in 2022.The Glucagon Emergency Kit manufactured by Eli Lilly is the preferred alternative for each of these PBMs. ESI specifically notes that the Fresenius brand of the Glucagon Emergency Kit is also excluded, with only the Eli Lilly Glucagon Emergency Kit being a preferred alternative.
• As CVS Caremark did in 2022, ESI greatly restricted coverage of diabetic supplies and needles. Any insulin needle or syringe that is not BD Diabetes brand is excluded by ESI in 2023. PHSL suspects that this change is largely rebate driven.
• OptumRx still requires prior authorization for Hepatitis C, Multiple Sclerosis, and Immunomodulator treatments. In 2022, OptumRx changed many of their preferred agents by replacing Simponi Aria and Renflexis with Avsola as a preferred immunomodulator. Kesimpta and dimethyl fumarate DR replaced Tecfidera for multiple sclerosis preferred treatments. There was no change in preferred Hepatitis C medications. For 2023, no additional changes are expected.
• CVS Caremark excluded brand Narcan after previously covering the opioid reversal agent. Although no alternative agent was listed, PHSL suspects that the change is due to the introduction of numerous generic agents.
• As mentioned in our 2022 Exclusion List Review, ESI continues to use indication-based management for the “inflammatory conditions” drug class. There are no additional excluded medications this year.

Each of the major PBMs have taken a different approach to managing drug expenditure in 2023, with formulary exclusions continuing to play a significant role. PBMs exclude products because of clinical, financial, and humanistic reasons. Each PBM makes value judgements and determines what coverage is no longer warranted. This article represents PHSL’s analysis of publicly available information regarding the three PBM’s formulary exclusion for 2023. Readers are encouraged to assess the lists for themselves, using the formulary and exclusion list source information provided in the links below.

• CVS Caremark 2023 Formulary
• ESI National Preferred Formulary 2023 Exclusions
• OptumRx 2023 Premium Formulary Exclusions
• CVS Caremark Formulary Watch
• CVS Caremark 2023 Formulary Updates

Posted January 11, 2023

Winter 2023 Newsletter:

Dispenser Track and Trace: Applicability to Patients

The Drug Supply Chain Security Act, also known as the Track-and-Trace Law, has been a topic of discussion for almost a decade. The FDA announced their 10-year plan in November of 2013 with the goal that each drug product would be traceable from the moment it was manufactured to the moment it was dispensed to the patient. The end of this 10-year roll out is in sight. The FDA set a compliance deadline of November 27, 2023, with pharmacies being the last stop in this journey.

The FDA implemented multiple staged deadlines throughout the past 10 years, with the first step in 2017 being manufacturers’ development of a 2D barcode that records the product NDC, serial number, lot number, and expiration date. Since then, repackers, wholesalers, and pharmacies have adapted their systems and workflow to comply with the new 2D barcode and tracking regulations. The goal is to directly identify recalled or suspect products and those who directly handled and received them.

The focus is now on the dispenser, i.e., pharmacy or healthcare facility. Review of the regulations is generating discussion around patient level tracking and potential best practices. Currently, the FDA only requires pharmacists to:

1. Confirm that the entities you do business with are licensed and registered.
2. Receive, store, and provide transaction history, transaction information, and transactions statements (3Ts). The 3Ts must be stored for at least 6 years. When dispensing to another entity instead of to an individual patient, such as dispensing to an ambulance service, the 3Ts must be provided to first responders or the other pharmacy. If a pharmacy transfers a product to another pharmacy that is not for a specific patient, the pharmacy may need to register as a wholesaler in the future.
3. Investigate and handle any suspect or illegitimate products.
4. In the event of a recall, upon request by the FDA or other appropriate Federal or State official, the pharmacy must provide the 3Ts for that product within two business days.

Each of these requirements are not cut and dried. Pharmacies must upgrade their software and modify their workflow to meet these standards. In addition, new guidance has been published by the FDA exempting certain products from this Act, including naloxone and some COVID-19 treatment and prevention products.

Many large chain pharmacies and hospital networks already have barcode scanning and inventory systems implemented into their workflow, but some of these systems only work with linear barcodes. Third-party tech companies have jumped into action offering new technology to fill this need. For large companies, the financial commitment is understood, but for small independent pharmacies, the financial burden of meeting these requirements could be substantial.

The DSCSA 10-year plan ends with the dispenser, but industry leaders question the process being implemented by certain pharmacies. The purpose of this law is to improve the safety of the patient, so why not extend this practice to the patient level? Extending to the patient level comes with numerous benefits, but also many concerns. In terms of patient safety, those affected by a recall or illegitimate product could be directly identified and notified sooner, avoiding the need for a patient to make a trip into the pharmacy or an unnecessary phone call. This allows the pharmacist to focus on the patients truly at risk.  Patients not at risk could still be a part of the notification for peace of mind, removing any patient uncertainty. If the tracing system is automated, time pharmacy personnel previously spent checking the shelves for recalled products would be alleviated. That time can be focused on other areas of demand, like point-of-care testing.

So, how would pharmacies extend this to the patient level? Pharmacy leaders first need to ensure that their technology and software can scan 2D barcodes and link the product information to a patient profile. Ideally, the system would be able to generate a report listing each patient that received a certain NDC, lot #, and expiration date. In the pharmacy workflow, pharmacy personnel would queue a prescription to be dispensed and added to a patient profile, scan the 2D barcode, and fill the prescription just as they do now. All the changes would occur behind the computer screen. The software would generate an inventory of all products received and the 3Ts for each product. Hypothetically, if a recall is issued, the system would identify if the pharmacy even received the product and then determine who the pharmacy dispensed the product to and generate a report. The next question is how does the pharmacy notify the affected patients? Just as many systems now notify the patient via phone call, text message, or email that their prescription is ready for pick-up, the pharmacy systems would do the same with recall information.

This idea sounds great in theory, but the costs required to develop, test, and implement new software may be prohibitive.  Additional resources would also be needed to retrain employees. The accuracy of the information within a patient profile is a key component, since this would be how the patient is notified. It would be vital for pharmacy leaders to discuss and formulate a plan before extending to the patient level.

The Drug Supply Chain Security Act has reshaped the pharmacy industry to ensure patient safety. Pharmacy leaders have overcome many challenges throughout this journey, but a lot of work is still needed to meet the November 27, 2023 deadline and before pharmacies can implement tracking at the patient level. The FDA has yet to budge on the November 2023 deadline, so PHSL encourages organizations to talk with their software vendors or IT support to ensure necessary steps are being taken to meet the requirements before this deadline. PHSL also encourages pharmacy personnel to be prepared to demonstrate their ability to access the 3Ts data upon an FDA or Board of Pharmacy inspection.

PHSL has written about Track-and-Trace since President Obama signed this Act in 2013. Please see the below publications for more information:

https://phsirx.com/news-events/phsi-newsletters/track-and-trace-implementation-update

Posted January 11, 2023

Winter 2023 Newsletter:

2023 Formulary Exclusions Lists: A Review of Express Scripts, CVS Caremark, and OptumRx