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The Evolving Landscape of Pharmacy Management: Trends, Costs, and Medications in 2023

This article explores current trends and challenges in pharmacy management, particularly focusing on the impact of prescription benefits, specialty medications, and rising drug costs. With insights from industry experts, we analyze the importance of medications in healthcare, user statistics, and the financial implications for employers and members. The piece also highlights the significance of generics and strategies for managing medication costs effectively. Understand the realities of today's pharmaceutical landscape and their effects on patient care and healthcare costs.

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The Evolving Landscape of Pharmacy Management: Trends, Costs, and Medications in 2023

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  1. Pharmacy Management Market Update Mona Chitre, PharmD, CGP Vice President, Pharmacy Management

  2. Quiz This “purple pill” helps your stomach not spontaneously combust after that late-night spicy dish you should not have eaten…

  3. Quiz • Prozac • Nexium • Motrin • Premarin

  4. Quiz This pill helps you “when the moment is right.”

  5. Quiz • Speed • Solodyn • Viagra • Caffeine Pills

  6. Quiz This pill helps you climb out from under a rock to face the world.

  7. Quiz • Allegra • Prozac • Zoloft • Diovan

  8. Quiz You’ve done it all in one night: You’ve eaten spicy food. The moment is right. You’ve crawled out from under that rock. Now it’s time to say “night-night.”

  9. Quiz • Ambien • Lunesta • Albuterol • Advair

  10. Drug Costs and Use Increasing GREAT JOB!! …However this proves that the pharmaceutical companies have done a great job as well.

  11. Pharmacy Management: Market Landscape • Impact of Prescription Benefits • Specialty Medications • Price Increases • Appropriate Care • Trend Management Opportunities

  12. Why are Prescriptions important: • #1 Benefit:Most commonly used benefit • 67-70% use the drug benefit each year • 12-15 prescription fills per person per year • #1 Cost:Drugs are the top cost driver

  13. How does Rx affect benefit plans? Medical Benefit Pharmacy Benefit Retail Pharmacy Mail Pharmacy Specialty Pharmacy Drug Cost : 20-25% of total health care cost ($75-$85 pmpm) • Hospital • Physician Office • Outpatient Facility • Clinics • Infusion centers • Home Infusion • DME • Drug Costs: 5-8% of total medical cost ($20-$25 pmpm)

  14. Prescription Benefit Medical Benefit Cancer Rheumatology Psoriasis Contraceptives Multiple Sclerosis Osteoarthritis Asthma Pulmonary Arterial Hypertension Diabetes Antidepressants Hypertension Hyperlipidemia PPIs Glaucoma Hemophilia Vaccines Immunoglobulins Enzyme Replacement

  15. Today’s pharmaceutical benefit reality $20 – generic Rx $200 – brand Rx $2,200 – specialty Rx

  16. SPECIALTY PHARMACEUTICALS

  17. New Technology: Specialty Drugs General Description: • High Cost • Biologics • Pharmacy or Medical Benefit (Oral, Injectable, Infusion) • Monitoring Required • Targeted • Chronic or genetic conditions with still an unmet need

  18. Top Ten Drug Projections

  19. Specialty Drug: Employer Impact Employer: 200 employees (450 total with coverage) • 5300 Prescriptions/ year • Average employer cost/Rx: $60 • Total Annual Rx cost for employer: $320,000 Specialty Drug Impact: Tykerb • Oral drug used in combination for breast cancer. • Incremental Added Cost: $55,000/ year 15% increase in Rx expense that year

  20. Specialty Drug: Employer Impact Large multiple employer coalition: • 41,000 covered lives • Medical Drug PMPM: $14.47 (07-08) • Medical Drug Trend: 50% over 2 years • Specialty Drug Impact: • 2 of the covered members treated with Fabrazyme • Annual cost of > $518,000 This drug accounted for 8% of the medical expense

  21. Cancer Costs and Responsible Behavior Questioned

  22. “Cancer Trends Demand Call To Action” The Tipping Point Cost Trends “At Memorial Sloan-Kettering Cancer Center, we recently made a decision that should have been a no-brainer: we are not going to give a phenomenally expensive new cancer drug to our patients” • Zaltrapv. Avastin • Same Efficacy • $11,000 difference

  23. More than 90 percent of cancer therapies approved in the last five years cost more than $20,000 for a 12-week course of therapy. Significant price increases in oncology products have not necessarily shown a correlation between overall survival or progression free survival.

  24. 2012/2013 Sample Specialty Rx Approvals

  25. Trend Management: Specialty • Pipeline Review and Planning • Use Management (to ensure safety and appropriateness) • Manufacturer Contracting (where applicable) • Waste Management • Collaboration with Specialists • Clinical Outreach: Adherence, Side Effect Management • Off-Label Use Management

  26. Pricing and Price Increases

  27. Case Study: Multiple Sclerosis • New Technology: • 2010: 2 New agents - 1stCombination drug and 1stOral Agent • Significant Price Increases: • 2006 Price - $ 15,000 • 2010 Price - $37,000

  28. Drug Cost Trends: Upstate New York

  29. Trend Management: GENERICS “Ask your doctor if a generic is right for you”

  30. Employer Impact: Case Study • Employer: 200 employees (450 total with coverage) • Avg 12 Rx/person/yr: approx. 5,300 Rx • Avg employer cost/Rx: $60 • Generic Fill Rate: 65% (3,445 of the Rx are for generic) • Total Annual Rx cost for employer: $318,000 • Generic Opportunity: Increase GFR to 70% • 265 brand drug Rx changed to a generic option. • Cost saving per Rx: $100 • Savings to employer: $26,500 (8% of spend) • Savings to employee: 200-$400+/year Each 1 point increase in GFR can reduce Rx spend by 2-3%

  31. Medication Management

  32. Medication Errors – National Data • Medication Errors are estimated to account for $21 billion in wasteful medical spending annually. • Inpatient preventable medication errors cost $16.4 billion annually. • Outpatient preventable medication errors cost $4.2 billion annually. • 70% of Medication Errors occur due to prescription mistakes. • Dosing errors – 37% • Drug allergies or harmful drug interactions – 11% • Medication reconciliation errors during admission – 22% • Fragmentation of Care • Survey shows only 13% of primary care physicians communicated with a pharmacist regarding new prescriptions.6

  33. Medication Non-adherence 50% of all prescriptions are not taken correctly • Human toll • About 125,000 preventable deaths/year • Diabetics: 699,000 ER Visits, 341,000 hospitalizations • Financial toll • Additional $290 billion dollars of health care costs • 13% of the total healthcare spend in this country • $8.3 billion in annual healthcare costs for diabetics

  34. Adherence rates across conditions * 1 year after initiation of both antihypertensive and lipid-lowering therapies; proportion of days covered ≥80%. † 1 year after initiation of therapy; medication possession ration (MPR) ≥80%. ‡ MPR 80%-110% of days eligible for Medi-Cal. § MPR >80% for patients with at least 90 days of observation.

  35. Trend Management: Adherence Improvement Social/ Economic Patient- related Therapy- related Condition- related HealthCare System The Five Dimensions of Non-Adherence*

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