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Tuesday Tip of the Week: Maximize DUM Programs to Manage Costs of Specialty Pharmaceuticals

Clogged Artery

In 2020, spend will nearly double and specialty will represent half of all drug spend. The market estimated to grow from $336 billion in 2018 to a predicted $475 billion to $505 billion by 2023 across developed markets.

As the fastest growing, most expensive segment of pharmacy spend, specialty drug trend is driven by the number of units, or utilization, and the cost per unit. Both utilization and prices are increasing in specialty.

One strategy for mitigating and managing costs with specialty pharmaceuticals is drug utilization management or DUM. Drug utilization management programs can be broken down into several key categories:

  • Prior Authorization (PA), which requires select prescriptions meet defined criteria before they are covered by the plan. The clinical assessment may include a diagnosis/age review, safety review, lab data validation, and pharmacogenomic protocols. Prescriptions are flagged at point-of-sale and prescribers are required to confirm that the use of an affected drug is medically necessary.
  • Step edits, which promote safety and cost savings by encouraging patients to try a first-line agent, before coverage is provided for a second-line, more costly drug. This could include a non-specialty to specialty step edit in which the patient needs to try and fail with an appropriate non-specialty drug before accessing a specialty medication. 
  • Specialty generic step edits, which require the trial and failure of a lower-cost specialty drug option(s) before accessing the brand drug.
  • DURs or drug utilization reviews from the first day of drug launch. This will ensure safe, effective, and appropriate drug utilization in accordance with FDA-labeling for all new-to-market specialty drugs. New drugs would reject for PA upon launch and be reviewed in accordance with FDA-labeling, bridging the gap until drug-specific criteria are available.
  • Quantity management or short fill programs are aimed at reducing waste and apply to a defined list of specialty medications with a high prevalence of adverse events (AEs) and potentially poor tolerability, which can lead to high discontinuation rates at the initiation of therapy. The goal of the short fill program is to minimize medication waste, while managing patient adherence and AE management, thereby potentially improving care and providing savings for patients and payers. 

Drug utilization management is not created equally between pharmacy benefit managers. A PA program, for example, at one PBM often performs differently at another. Here are a few questions to consider:

1) Are your PAs properly enforced?
2) Are your current PAs effective?
3) Do you receive proper reporting on PA approvals and denials?
4) How often do you require PAs?

Once the prescription has been written, many specialty pharmacies primary objective is to get the product out the door. In other words, PAs often become a check-the-box exercise don’t allow that to happen in your plan.

Tyrone Squires, MBA, CPBS

I am the proud founder and managing director of TransparentRx, a fiduciary-model PBM based in Las Vegas, Nevada. We help health plan sponsors reduce pharmacy spend, by as much as 50%, without cutting benefits or shifting costs to employees.

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