Step #1:  Obtain a price list for generic prescription drugs from your broker, TPA, ASO or PBM every month.


Step #2:  In addition, request an electronic copy of all your prescription transactions (claims) for the billing cycle which coincides with the date of your price list.

Step #3:  Compare approximately 10 to 20 prescription claims against the price list to confirm contract agreement.  It’s impractical to verify all claims, but 10 is a sample size large enough to extract some good assumptions.

Step #4:  Now take it one step further. Check what your organization has paid, for prescription drugs, against our acquisition costs then determine if a problem exists. When there is a 5% or more price differential (paid versus actual cost) we consider this a problem.

Multiple price differential discoveries means that your organization or client is likely overpaying. REPEAT these steps once per month.

— Tip —

Always include a semi-annual market check in your PBM contract language. Market checks provide each payer the ability, during the contract, to determine if better pricing is available in the marketplace compared to what the client is currently receiving.

When better pricing is discovered the contract language should stipulate the client be indemnified. Do not allow the PBM to limit the market check language to a similar size client, benefit design and/or drug utilization. In this case, the market check language is effectually meaningless.

The customer, Anthem — owner of a variety of Blue Cross Blue Shield health insurance firms — is responsible for roughly 18% of Express Scripts’ first quarter revenue, Express Scripts said in a release.

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As a health insurer, Anthem contracts with pharmacy benefit managers like Express Scripts to help negotiate lower prices for prescription drugs. Anthem accused Express Scripts of not passing along those savings, claiming Express Scripts overcharged the insurer by billions of dollars. The ending of the contract comes after Anthem last year sued Express Scripts over the issue.

“Although conversations have been ongoing, the Company was recently told by Anthem management that Anthem intends to move its business when the Company’s current contract with Anthem expires on December 31, 2019, and that Anthem is not interested in continuing discussions regarding pricing concessions for 2017-2019 or in receiving the Company’s proposed pricing for the period beyond 2019,” said the release from Express Scripts.

Pharmacy benefit managers, or PBMs, including Express Scripts have come into the spotlight as the drug industry faces increased scrutiny over the price of prescription medicines. Drug companies, which bear the brunt of the heat over this, have been trying to convince people that they’re not the problem. Instead, they’ve pointed the finger at the PBM’s which they say are responsible for negotiating lower prices in the form of rebates.

Those rebates are meant to be passed on to patients, but a recent report from the drug companies’ lobby found that that’s not the case for 20% of prescriptions filled. Instead, the implication here is that the companies meant to pass along the rebates are keeping all of the money for themselves, in those cases. It’s led to finger-pointing from both PBMs and drugmakers over where those rebates are going.

The similarity between Renflexis and the reference product has been demonstrated for indications, dosing, and administration. While the inactive ingredients vary between the 2 drugs, there are no clinically meaningful differences in safety and efficacy.

Common side effects include upper respiratory infections, sinusitis, and pharyngitis, infusion-related reactions, headache, and abdominal pain, according to the FDA.   In April 2016, the FDA approved the first biosimilar of Remicade, Inflectra (infliximab-dyyb), for multiple indications across a range of autoimmune diseases. Inflectra was the second biosimilar to be approved in the United States and is also administered by intravenous infusion.

Remicade was the first anti-tumor necrosis factor-alpha treatment approved in the United States to be approved in gastroenterology, rheumatology, and dermatology, according to Janssen. The safety and efficacy of the drug has been well established in clinical trials over the past few years, with more than 1.5 million patients treated worldwide.

– See more at: https://www.specialtypharmacytimes.com/news/fda-approves-second-remicade-biosimilar#sthash.EKplAYoq.dpuf

Step #1:  Obtain a price list for generic prescription drugs from your broker, TPA, ASO or PBM every month.


Step #2:  In addition, request an electronic copy of all your prescription transactions (claims) for the billing cycle which coincides with the date of your price list.

Step #3:  Compare approximately 10 to 20 prescription claims against the price list to confirm contract agreement.  It’s impractical to verify all claims, but 10 is a sample size large enough to extract some good assumptions.

Step #4:  Now take it one step further. Check what your organization has paid, for prescription drugs, against our acquisition costs then determine if a problem exists. When there is a 5% or more price differential (paid versus actual cost) we consider this a problem.

Multiple price differential discoveries means that your organization or client is likely overpaying. REPEAT these steps once per month.

— Tip —

Always include a semi-annual market check in your PBM contract language. Market checks provide each payer the ability, during the contract, to determine if better pricing is available in the marketplace compared to what the client is currently receiving.

When better pricing is discovered the contract language should stipulate the client be indemnified. Do not allow the PBM to limit the market check language to a similar size client, benefit design and/or drug utilization. In this case, the market check language is effectually meaningless.

A major problem for patients and the health-care system—how higher-than-anticipated drug prices and patients who are stuck with more of the cost burden means more nonadherence and waste. For nonspecialty drugs, patient copays represent 20% to 25% of the drug’s cost, but for specialty drugs, copays represent less than 2% of the medication’s total cost. Avey was surprised, however, to see that financial concerns only represented 2% of patient responses in a patient survey.

The number one thing payers can do, Avey said, is to avoid waste, by addressing poor adherence, paying for the wrong dosage, gaps in care or inappropriate dosing, and prescribing drugs that are not indicated for the patient’s genetic mutation status. To prevent waste, he stressed that it is important for the specialty pharmacy to contact the provider and ask why a patient is not receiving or taking the appropriate regimen.

Ciarametaro discussed affordability, which is different for each stakeholder in the health-care system (patients, payers, society, or purchaser). He also made the distinction between affordability, value, and budget impact. “I would argue that increasing drug spending is not necessarily a negative indicator. We still need to figure out how much we should spend on drugs,” he said.

PBMs only have limited tools to deal with costs and interact with the various stakeholders, and they must deal with and balance covered therapies, utilization management, patient out-of-pocket costs, and rebate contracting with regard to premiums. A single determination of value is not adequate and needs to be tailored to the population, the condition, and the region of care, he said.

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Step #1:  Obtain a price list for generic prescription drugs from your broker, TPA, ASO or PBM every month.


Step #2:  In addition, request an electronic copy of all your prescription transactions (claims) for the billing cycle which coincides with the date of your price list.

Step #3:  Compare approximately 10 to 20 prescription claims against the price list to confirm contract agreement.  It’s impractical to verify all claims, but 10 is a sample size large enough to extract some good assumptions.

Step #4:  Now take it one step further. Check what your organization has paid, for prescription drugs, against our acquisition costs then determine if a problem exists. When there is a 5% or more price differential (paid versus actual cost) we consider this a problem.

Multiple price differential discoveries means that your organization or client is likely overpaying. REPEAT these steps once per month.

— Tip —

Always include a semi-annual market check in your PBM contract language. Market checks provide each payer the ability, during the contract, to determine if better pricing is available in the marketplace compared to what the client is currently receiving.

When better pricing is discovered the contract language should stipulate the client be indemnified. Do not allow the PBM to limit the market check language to a similar size client, benefit design and/or drug utilization. In this case, the market check language is effectually meaningless.

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The challenges associated with specialty pharmacy, biologics, and biosimilars require a whole new playbook, one with collaboration as the organizing principle. Payers and providers can work together in several areas to rein in the galloping drug spend:

1. Clinical management. Given the rapid evolution of the pharmaceutical market, the question is no longer whether a treatment exists for a condition, but how effective it is. The pace of innovation and approvals puts a premium on keeping up with the incoming waves of new research, driving adherence to evidence-based protocols, and engaging with patients so they follow treatment as prescribed.
2. Cost containment. When it comes to pharmaceutical cost and trend, misaligned incentives can get in the way of optimal solutions. Payers and providers must streamline their processes, especially as they pertain to medications, and wring out unnecessary expenditures whenever possible. Reducing costs can involve many levers, including standardizing therapies and negotiating prices accordingly, expanding the use of generics, exploring biosimilar alternatives, and optimizing use of the 340b program.
3. Appropriate sites of care. When it comes to specialty drugs, the driver of total cost is not just in the unit pricing but also in how and where those drugs are administered. Costs can vary widely depending on whether a drug is administered in the physician office, at a specialty pharmacy, or at home. Working jointly to steer patients to the most effective sites will boost total effectiveness and help control costs.

None of this will be easy. Even if drug-cost legislation is enacted, there is no guarantee such controls will be effective absent providers and payers working together. But, if we can get it right, we can hold specialty pharmaceuticals to the same standards of value that are reshaping the rest of health care.

by Zachary Hafner

Step #1:  Obtain a price list for generic prescription drugs from your broker, TPA, ASO or PBM every month.


Step #2:  In addition, request an electronic copy of all your prescription transactions (claims) for the billing cycle which coincides with the date of your price list.

Step #3:  Compare approximately 10 to 20 prescription claims against the price list to confirm contract agreement.  It’s impractical to verify all claims, but 10 is a sample size large enough to extract some good assumptions.

Step #4:  Now take it one step further. Check what your organization has paid, for prescription drugs, against our acquisition costs then determine if a problem exists. When there is a 5% or more price differential (paid versus actual cost) we consider this a problem.

Multiple price differential discoveries means that your organization or client is likely overpaying. REPEAT these steps once per month.

— Tip —

Always include a semi-annual market check in your PBM contract language. Market checks provide each payer the ability, during the contract, to determine if better pricing is available in the marketplace compared to what the client is currently receiving.

When better pricing is discovered the contract language should stipulate the client be indemnified. Do not allow the PBM to limit the market check language to a similar size client, benefit design and/or drug utilization. In this case, the market check language is effectually meaningless.

Eighty percent of every dollar is spent on medical expenses, and the remaining 20 percent was split between operating costs and net margins, showing that payers are adhering to the 80/20 rule instituted by the ACA.

“This is the latest evidence that shows prescription drug costs are out of control,” said Marilyn Tavenner, President and CEO of AHIP in an accompanying statement.

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“The vast majority of every dollar spent by consumers on insurance premiums is returned in direct medical services, including prescription drugs. That’s why we need real solutions that answer the President’s call to ‘bring down the artificially high price of drugs’ so that consumers can affordably get the care they need.”

The AHIP report used data from premiums contributed by patients under 65 who were continuously insured.

Outpatient services consumed 19.8 cents of every dollar while 15.8 cents were spent on covering inpatient services. Operating costs for payers were 17.8 cents per premium dollar.

In 2014, healthcare expenses totaled $104 billion. Prescription drug spending accounted for $28.9 billion and physician services  accounted for $28.8 billion. Outpatient and inpatient services, respectively, cost $26.1 and $20.7 billion.

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