Medco’s report provides loads of data from its top 201 clients (65% of total spend). But the most interesting part of the report for me deals with Medco’s future strategy.
Pharmacogenomics—using genetic variations to improve drug response—is the foundation of Medco’s Making Medicine Smarter™ message. I think it provides a powerful platform for the company in a post-2014 world with few generic launches. If this revolution turns out to be real, then Medco will win big in the personalized medicine future.
HIGHLIGHTS FROM THE DRUG TREND REPORT
A few nuggets from the report:
- Specialty trend was 14.7%, or more than 8X the 1.8% trend of traditional drugs. For comparison, Medco’s specialty trend was 15.8% in 2008.
- Specialty trend was driven by higher “unit cost,” which reflects both price increases and therapeutic mix in Medco’s lexicon. Utilization refers to “the quantity of drugs obtained by plan members.” For specialty drugs, utilization crept up by only 2.6% while unit costs jumped 12.1%.
Medco made an effort to slice the data to dig out newsworthy nuggets. For example:
- Drug trend for children (under age 19) exceeded all other age groups. However, total spending remains concentrated in older patients. Net plan costs in 2009 for people over 65 was $1,833 versus $233 for members under 19. (See page 30.)
- They correlated sleep deprivation and drug utilization (page 32). OK, whatever. I’m skeptical of this finding, but then again I live in the hard-charging sleep-deprived Northeast instead of the apparently well-rested West Coast.
You have to wait until page 86 for the most fascinating part of the report—a primer on personalized medicine, defined by Medco as follows:
“Personalized medicine, or the practice of using diagnostic tests to detect and tailor treatments based on unique individual genetic variations, holds the promise of making medical care more precise and effective.”As it happens, I was at a fascinating talk by Robert Epstein, the Chief Medical Officer at Medco, in Boston on Wednesday. The possibilities for more effective care (and better management of trend) are truly astounding. BTW, Dr. Epstein is a very engaging and informative speaker, so try to hear him if you get the chance.
For example, Medco is conducting a series of comparative effectiveness clinical trials under a concept they call Genetics for Generics™. (Hmmm, another trademarked phrase.) As I understand the program, Medco intends to use biomarkers to optimize drug treatment when:
- A generic competes with a brand name drug
- Multiple generic drugs could be used for the same indication
- Treatment regimen of a generic could be optimized
Medco is investing heavily in creating a future for the PBM industry. Will it work?
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P.S. The image above comes from the awesome t-shirt collection at Mental Floss.