Bend the trend: 5 strategies for clients to manage specialty pharmacy costs

With specialty pharmacy costs continuing to climb faster than virtually every other segment of health care spending, a comprehensive strategy aimed at managing these costs has never been more important.

Using a holistic approach — from effectively managing specialty drugs across both pharmacy and medical benefits to applying new clinical approaches and innovations — it is possible to bend the cost trend for specialty medications. 

Consider the success achieved by one UnitedHealthcare national client. The company, using a comprehensive strategy, held it’s spend on specialty medications across both the medical and pharmacy benefit to a 2.4 percent year-over-year increase during a time when large employers saw these costs climb in excess of 15 percent.  

Here are 5 ways to think about a comprehensive strategy for specialty management.

1. Take a holistic approach across both medical and pharmacy benefits

For certain therapies, the reimbursement for specialty medications can vary considerably based on the administration setting, so UnitedHealthcare looks for ways to move from higher-cost outpatient hospital settings to lower-cost settings, such as provider office, infusion suite or home infusion when appropriate.

For example, UnitedHealthcare has shifted 40 percent of immune globulin infusion utilization from outpatient hospitals to lower-cost sites of care, such as home infusion. Using this approach, UnitedHealthcare reduced the costs in this category by 9 percent. In addition, shifting administration for medications for inflammatory conditions, such as Remicade for treating rheumatoid arthritis, Crohn’s disease and psoriasis, has delivered a 46 percent movement from higher-cost to lower-cost sites of care. This translates to approximately $13,000 in annual savings per patient.    

“Customers embrace the (site-of-care shift) program. So do members – when they can safely get their infusion at home instead of traveling to a medical center,” says UnitedHealthcare’s Chief Pharmacy Officer Susan Maddux. Based on benefit designs, this may also reduce the member’s out-of-pocket costs.

2. Identify the right drug for the right patient

It’s always important to prescribe the right medication for the right patient, but the cost and complexity of specialty medications warrant a higher level of review. The key to effective management is to accurately identify those patients who are most likely to benefit from these high-cost medications using information such as severity of disease, treatment history and genetic testing as appropriate.

For example, an injection of Luxturna, approved in December 2017 as the first directly administered gene therapy targeting a rare disease caused by mutations in a specific gene, costs over $400,000 per eye. But it almost immediately reverses vision loss caused by this rare inherited disease. Before such a drug is approved for any given patient, a genetic test will need to show the patient has the specific genetic mutations this drug treats as well sufficient remaining retinal function to indicate success is achievable.[1]  UnitedHealthcare’s prior authorization criteria would review all pertinent information noted above before coverage is approved.

Some new specialty medications pose a further challenge because they target disease states affecting larger numbers of patients for whom less costly, yet generally effective, treatments already are available. For example, new specialty migraine treatments are in development for a disorder frequently treated with inexpensive generics. Although some patients may benefit from these new therapies, the vast majority will not see an incremental reduction in the number of migraines experienced. Even though these new migraine therapies are not yet approved by the Federal Drug Administration (FDA), UnitedHealthcare has developed prior authorization criteria which will only cover the medication for those people who continue to have migraines after maximizing treatment with other evidenced-based drug regimens. 

There may be subsets of patients for whom these specialty medications are appropriate, and the indirect costs of an ineffectively treated condition – such as absenteeism due to chronic migraines – are also considered as part of an overall assessment of the drug’s total value.

3. Ensure proper drug administration and adherence

To be most effective, medications must be administered precisely according to the prescribed regimen. For some specialty medications, such as self-injectables or medications with atypical dosing regimens, there may be additional barriers to proper administration and adherence.

“For a member receiving a specialty medication for the first time, it can be the cost equivalent of a new car arriving at their door and is likely the most expensive thing they’ve ever held in their hand,” says Nick Rogers, Vice President, UnitedHealthcare Pharmacy. “These patients are either newly diagnosed or undergoing a significant change in disease progression. These factors together demand a high-level of support to ensure the drug is used in a manner that will achieve maximum clinical effect and avoid any potential waste. We have support available to guide individuals through every step of this process.”

The stress of a new diagnosis or the volume of information accompanying the medication may make it difficult for patients to understand how to administer the medication. That’s why OptumRx’s specialty arm, BriovaRx®, offers both live and on-demand online video consultation from home with Briova specialty pharmacists or nurses. The Briova team members coach and demonstrate to patients how to administer their new medication, discuss managing side effects, drug interactions and the importance of adherence. Patients can save videos of the conversation that they can later review as they become familiar with the medication.

Patients who participated in a BriovaLive™ consult with a specialty pharmacist have been shown to be 7 percent more adherent to their medications and are more confident in managing side effects that typically come with these medications. By understanding and knowing how to manage side effects, there is a lower likelihood they will need to use other health care services such as the ER or urgent care facilities.[2]

4. Biosimilar inroads have been limited

Many observers hope that biosimilars – the specialty pharmacy version of generics, except that unlike generic medications they are similar but not identical to the existing biologic medicine – will play a major cost management role. But UnitedHealthcare experts advise that biosimilars cannot be the only management tactic, noting that only 2 major brand name medications have commercially available biosimilars in the United States despite others being approved by the FDA.

“The high cost of developing and manufacturing biosimilars makes it likely they will have their own brand names, support programs and coupons, and sell at price points at a discount of approximately 20 percent below their patented predecessors,” Rogers says. Achieving lower costs in these instances will require active negotiation with the various manufacturers to reduce costs beyond published prices. Biosimilars do have the potential to create more pricing competition for current brand name therapies but the slow approval process and patent litigation have stalled a number of these from reaching the market.  

5. It’s never too soon to put a specialty drug management strategy in place

UnitedHealthcare’s work on an effective management strategy for a new specialty medication today starts well before a drug is approved by the FDA.

“We don’t wait for FDA approval to begin the evaluation and development of coverage strategies, understanding available clinical and financial information,” Rogers says. “Evaluation of the drug pipeline can begin years prior to formal FDA approval.”  

Many employers feel they do not have an adequate strategy in place to manage specialty pharmacy costs.[3] UnitedHealthcare can help your clients take steps to better control their spending on specialty medications. For more information, contact your UnitedHealthcare representative.