The Next Phase of Pharmaceutical Value Propositions Needs to Include the Real Meaning of Synergy

Synergy Blog ImageExpress Scripts recently issued a report on drug spending that made some headlines in the business press.[1,2] This compelling report shows that, from the perspective of a pharmacy benefit manager (and its pharmacy claims database), evidence confirms the trends of increased drug spending, particularly in the subset of patients that consumes at least $100,000 worth of drugs annually:

• The population of patients that takes at least $100,000 worth of drugs has almost tripled from 2013 to 2014
• Compounded drugs were the 3rd highest driver of the trend, behind HCV antivirals and oncolytics
• 9 out of 10 patients with drug costs over $50,0000 used specialty medications
• Men and baby boomers (those aged 51-70) make up the majority of those with high drug costs
• Comorbidities and polypharmacy were prevalent among patients with high drug costs

Glenn Stettin, MD, the SVP of Clinical, Research, and New Solutions, outlines in this report implications and recommendations, most of which are feasible for a PBM to consider:

• Eliminate wasteful spending and improve medication adherence
• Manage specialty and traditional medications together
• Pioneer new approaches in cancer care that both offers patient access and sustains payer affordability

While these are important recommendations, there is an opportunity for pharmaceutical manufacturers to consider extending and enhancing the value propositions of their drugs, and it relates to the “comorbidities and polypharmacy” finding in this report, which is pretty remarkable. The report shows that:

• Among patients whose drug costs reached $100,000, more than one-third were treated for more than 10 conditions
• More than 60% were taking more than 10 medications
• One in four patients had prescriptions from at least 4 different prescribers
• More than half of patients with $100,000 in drug costs were prescribed medications by physicians from at least 4 difference specialty areas

Now, as we read daily in the business press, the drug industry is facing pushback about its pricing of newer agents (specifically HCV antivirals and oncolytics). This resistance from customers is normal, and has taken various forms of stricter precertifications and/or formulary requirements.[3] Recently, legal patent challenges have surfaced; in some countries, various advocates are asking that patents on drugs be voided, so that generic competitors can appear earlier.[4] Nonetheless, evolving industry forces, such as comparative effectiveness research, constrained health care budgets of some payers, and new competitors have started to create a new equilibrium between sellers and buyers, and these forces are helping to more quickly vet winners and losers. It is encouraging to see the manufacturers (particularly of HCV and cancer drugs) refine the value propositions of their drugs, which now include cures for some patients.[3]

But disease is multifactorial (and, as the ESI report shows, multiple diseases are, too), and treatments often need multiple approaches. Manufacturers may need to extend the current value proposition of “one drug that treats one disease at one time” and add it to the complicated heath care mix that includes other variables, for example:

• Combination therapies (with other drugs, including competitors and/or generics, and with other modalities such as devices, diet, surgery, etc.)
• Timing or sequence of treatments (ie, phase of the disease)
• All of the factors in “care coordination” (ie, different physicians, different specialties, different settings)

In other words, manufacturers need to demonstrate the synergy produced by their drugs. “Synergy” is often misused, but I like the Merriam-Webster definition of synergy as “a mutually advantageous conjunction or compatibility of distinct business participants or elements (as resources or efforts).”[5] Certainly some treatment guidelines, pathways, and medical policies attempt to address these multiple variables in health care. But manufacturers can bring their significant credibility in clinical research and patient experience to identify, define, and demonstrate the specific opportunities that optimize their drugs’ performance. They are best-suited to do so, and the customers are receptive to that type of message. (Note: as this heads to posting, 2 manufacturers are reported to have taken this approach and are studying their oncology drugs in combination.[6])

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Footnotes:

1. Super Spending: US trends in high-cost medication use. May 2015. http://lab.express-scripts.com/insights/drug-options/super-spending-US-trends-in-high-cost-medication-use. Accessed May 19, 2015.

2. Growth of patients with $50K annual drug tabs skyrockets. Fierce HealthFinance. May 17, 2015. http://www.fiercehealthfinance.com/story/growth-patients-50k-annual-drug-tabs-skyrockets/2015-05-17). Accessed May 19, 2015.

3. Gilead’s $1,000 Pill Is Hard for States to Swallow. The Wall Street Journal. April 8, 2015. http://www.wsj.com/articles/gileads-1-000-hep-c-pill-is-hard-for-states-to-swallow-1428525426. Accessed May 21, 2015.

4. High Cost of Sovaldi Hepatitis C Drug Prompts a Call to Void Its Patents. http://www.nytimes.com/2015/05/20/business/high-cost-of-hepatitis-c-drug-prompts-a-call-to-void-its-patents.html. Accessed May 20, 2015.

5. Merriam-Webster Online. http://www.merriam-webster.com/dictionary/synergy. Accessed May 21, 2015.

6. AstraZeneca and Lilly to test new cancer drug combination. Reuters. May 29, 2015. http://www.reuters.com/article/2015/05/29/us-astrazeneca-eli-lilly-cancer-idUSKBN0OE0HU20150529. Accessed May 29, 2015.

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