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Navigating Specialty Drugs and Potential Budgetary Impacts

October 31, 2019

In a session at AMCP Nexus 2019 entitled, “Fast and Furious: What is Driving the Specialty Spend?” Jann Rigell, RPh, MBA principal, enterprise specialty programs, MedImpact Direct, and Susan Trieu, PharmD, director, enterprise specialty clinical Solutions, MedImpact Healthcare Systems, Inc, discuss how specialty drugs are affecting the health care space on a number of levels.

In their session, Ms Rigell and Dr Trieu explained that approximately 50% of total pharmacy spend is specialty and that compared to the total market, specialty spend is outpacing traditional growth.

Specialty therapy is most prevalent in oncology and autoimmune diseases—$64 billion and $61 billion, respectively according to the IQVIA National Sales Perspectives from August 2019. However, HIV antivirals ($23.7 billion) and multiple sclerosis ($18.7 billion), also account for significant percentages of total specialty therapy spend.

The presenters noted that there are game changers in specialty spend which included sickle cell disease, cystic fibrosis, and hemophilia, where gene therapies are on the horizon and could disrupt the market over time.

Ms Rigell and Dr Trieu presented data from an ICER report on price increases which “evaluated 100 top drugs with price increases >2x inflation measured by medical price consumer index.”

In this research, they found a number of discrepancies “with pricing submitted from manufacturers vs. data source excluded 2 agents and 2 agents had demonstrated positive clinical data but analysis was not conducted on value of studies.”

Top list price increases included Lyrica with a 28.3%, Ciallis with 26.2%, and Humira with a 19.1%. Twenty-six of the drugs included in the analysis had price decreases.

“The autoimmune category often includes drugs that treat a wide variety of disease states including rheumatoid arthritis (RA), juvenile arthritis, psoriatic arthritis, plaque psoriasis, atopic dermatitis, ankylosing spondylitis, ulcerative colitis (UC), and Crohn's disease,” explained Ms Rigell and Dr Trieu.

Changes in the autoimmune pipeline brought on by a crowded market, market monopolies, and difficulties differentiating have inspired a number of new therapies to emerge. One example the presenters provided was filgotinib, an oral agent for treatment of rheumatoid arthritis that is expected to have an FDA decision in March 2020.

This treatment is designed for an RA population where prior treatments have failed. As a JAK inhibitor, it’s market share is expected to be relatively low but it is becoming increasingly popular. As for costs, it is expected to be priced similarly to other JAK inhibitors, Ms Rigell and Susan Trieu explained, at approximately $42,000 annually.

The top spender in specialty therapy, as mentioned earlier, is oncology. Mr Rigell and Dr Trieu explained that oncology is a vast area, comprising a number of treatment types. Some considerations when examining therapy in oncology include the following:

  • Formulary management can be challenging;
  • Most medications approved for relapsed/refractory members then indications expanded;
  • Treatment is often approved by compendia, but can’t always wait for FDA indication;
  • Biosimilars launched in US; and
  • Treatment crosses both pharmacy and medical benefit, making it difficult to manage.

For example, multiple myeloma has a variety of standard treatments including chemotherapy, stem cell transplant, immunomodulating agents, proteasome inhibitors, histone deacetylase inhibitors, and monoclonal antibodies. In 2020, there are three treatments on the pipeline. Isatuximab is awaiting FDA decision, expected April 2020. Belantamab mafodotin and bb2121 are both in the pipeline but not yet filed for approval with the FDA.

Overall, Ms Rigell and Dr Trieu explained that, “Innovation will continue to drive specialty spend. Generics will help in certain areas, especially if biosimilars in the autoimmune space but not until 2023.”

They also noted that when examining specialty spend, looking at the big picture is extremely important. While specialty comprises a substantial portion of total spend, 40% to 60% is paid under Medical benefit. Different sites of care for medical specialty claims include:

  • Physician office injections and infusions of specialty medications;
  • Hospital outpatient injections and infusions of specialty medications;
  • Stand-alone infusion center injections and infusions of specialty medications; and
  • Home infusion injections and infusions of specialty medications.

A challenge often faced when dealing with specialty spend has to do with J-Codes. According the information Ms Ridell and Dr Trieu presented, J-codes lack the specificity needed for NDCs, details on how they are administered, and present problems in claim systems, causing ineffectively utilization data and management.

To offset unnecessary spend and management difficulties, Ms Rigell and Dr Trieu explained that integrated strategies improve utilization management, claims editing, and retrospective DUR. A top suggestion was making changes to the site of care, moving the member to the most cost-effective site for drug administration (usually from the hospital outpatient to MD office or home infusion/center).

Lastly, Ms Rigell and Dr Trieu explained that the main takeaways from the information presented is that; (1) specialty spend will continue to outpace traditional drug spend; (2) Get the “big picture” on your specialty spend; (3) Uncover waste and potential savings in the medical specialty spend; and (3) Implement integrated strategies to manage your specialty spend.

To read a past interview with Susan Trieu on Preparing for New Therapies in the Pipeline, click here.

—Edan Stanley

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