Rapidly Evolving Specialty Pharmacy Industry

San Diego—With the dominance of specialty drugs driving increasing prescription medication expenditures, pharmacists need to prepare for significant growth in specialty pharmaceuticals and its impact on medication benefit plans.

“The growth and diversity with specialty medications is a new arena,” said Helen Sherman, PharmD, vice president, Solid Benefit Guidance, LLC, speaking to attendees at a Managed Care Essentials session at the AMCP meeting, emphasizing the need to keep sight on costs and future industry dynamics. The session was titled The Dynamic, Rapidly Evolving Specialty Pharmacy Industry: Are You Ready for the Changing Tide?

Current estimates predict that 31% to 40% of the total medication spend will result from specialty drugs between 2014 and 2016. The clinical areas in which these drugs are playing a major role can be seen in the number of potential new specialty medication launches in 2011, which included 25 in oncology, 22 for orphan disease, 15 in hematology, 14 in immunology, and 5 in infectious disease.

During the session, Dr. Sherman provided an overview of several key issues for pharmacists regarding the new arena of specialty pharmaceuticals in which both large and small pharmaceutical companies will be players.

Identifying a Specialty Drug and Creating a Master List

A fundamental need for pharmacists will be the ability to identify a specialty drug, said Dr. Sherman. She went on to say that there is no current FDA designation of specialty drugs nor is there a standard definition used by the industry. Currently, specialty lists can include between 50 and 500 drugs.

Although she emphasized there is no perfect definition, she described several characteristics that can be used to define a specialty drug. These include drugs with a higher cost (>$400-$600 per month); those that require specialized patient training and/or care coordination; those that require specialized handling, shipping, or storage not supported in retail or mail-order pharmacy settings; those used in complex chronic conditions or rare conditions; and those that require specialized compliance, safety/lab monitoring, or care support. Generally, she said, specialty drugs are high-cost medications for a small portion of the overall population.

Identifying a drug as a specialty drug is important, she emphasized, as it will be used to frame decision-making about medication access and coverage, provider reimbursement, and procurement, as well as influencing healthcare outcomes.

She encouraged pharmacies to develop a master list of specialty drugs that can be updated based on evaluating specialty strategies across medical and pharmacy benefits.

Specialty strategies, she said, should ensure a level playing field between medical and pharmacy benefits as well as ensure costs do not rise and shift to higher-cost sites of service or overlooked health benefit plan components. For example, she emphasized the need to be aware of high margin specialty pharmacy areas such as generic drugs as well as services, supplies, and equipment. She also emphasized the need to ensure that generics are priced the same as retail/mail-order prices, and that services, supplies, and equipment are priced similar to market competitive options.

Emerging Specialty Trends

She concluded her presentation with a discussion of trends in specialty pharmaceuticals, such as the creation of specialty drug tiers and optimizing sites of service. Another trend is the requirement for benefit plan members to use specialty pharmacy for designated medications. Although she said that this can be an effective strategy for self-administered medications with a well-developed specialty list, she cautioned that this strategy could result in care coordination issues and waste for medications administered in physician offices.

She emphasized that the design of current benefit plans may not be the best solution for these future trends in specialty drugs.