Friday, May 01, 2020
Elsevier: Challenges and Trends to Watch in 2020 (Guest Post)
Trygve discusses trends and challenges to watch in 2020, including drug pricing transparency, the approval and interchangeability of biosimilars, and stakeholder access to timely and accurate data.
Learn more about Elsevier’s information analytics capabilities from its video: Evaluating Drug Data Yields Business Value.
Read on for Trygve’s insights.
Challenges and Trends to Watch in 2020
By Trygve Anderson, Vice President, Commercial Pharmacy, Elsevier
Drug price transparency regulations have become the norm with more than 40 states supporting MAC transparency laws. Certainly, one challenge that remains constant in the pharmacy industry is the disconnect between AWP and a drug’s acquisition cost. This challenge is what prompted Ohio Medicaid to move away from a pass-through reimbursement policy and move toward a pharmacy cost plus dispensing fee approach.
This challenge is also prompting many stakeholders to seek an alternative pricing benchmark–PAC, because it is closely aligned with a drug’s acquisition cost and supports pricing strategies. PAC also utilizes a data science-derived acquisition cost to augment business analytic capabilities by providing actionable cost insight to help deploy analytic models.
With Medicare Part D prescription drug spending on the rise, and strong and bipartisan support for policymakers to ensure the affordability of medications–there are many policy options under consideration. For instance, one proposed policy would allow Medicare to negotiate drug prices. Adam Fein discusses some of these challenges in the blog post: Why Part D plans prefer high list price drugs that raise costs for seniors.
Additionally, the pharmaceutical industry continues to express its resistance to this proposal based on concerns that it would lower revenue, have a dampening effect on research and development, and limit access to new and expensive drugs. Other proposed changes include using an international reference for pricing drugs covered by Medicare and rebate sharing. While there is no immediate action underway regarding these policies, they continue to gain traction suggesting–change is on the horizon.
Biosimilars are expected to gain a stronger foothold in 2020 and expectations are high as new oncology products enter the market. Even though there were 26 approvals of biosimilar drugs in 2019, only a fraction of them were on the market at the end of 2019. Currently the launch of three major biosimilars in oncology (rituximab/Rituxan, bevacizumab/Avastin, and trastuzumab/Herceptin) each place among the top five biologic drugs driving the highest spend–accounting for a total of 19.4 billion dollars in sales in 2018. With the onset on these oncology biosimilars, adoption of biosimilars’ should increase helping to impact and lower the cost of drug prices in 2020.
Interchangeability or the designation to allow substitution of a biosimilar drug at the pharmacy–without involvement of the prescriber is another area that may impact the adoption of biosimilar drugs. Even though the FDA provided final guidance on interchangeability in May of 2019, no interchangeable biosimilar has been approved in the United States. However, Boehringer Ingelheim has been conducting interchangeability studies for a biosimilar to AbbVie’s Humira. It will be interesting to watch this throughout 2020.
The ever-expanding pipeline of specialty drugs will continue to impact drug spending in 2020 and beyond. As new specialty therapies get approved stakeholders will be developing plans for controlling costs, solidifying adherence programs and gaining insight from utilization using data analytic strategies.
The evolution of data is not only ongoing it is increasing in velocity. In 2018, Elsevier processed nearly 4.5 million pricing changes, based on distinctive effective dates across the year–including all publicly available price types. It is not hard to imagine the impact on your business if you are using outdated pricing data for a vast amount of business transactions.
Stakeholders are realizing the importance of maximizing the utility of drug data and challenging the assumption that their current data is as accurate and timely as it should be. Stakeholders are utilizing benchmarking techniques to evaluate data at the point of reception and analyzing the impact of inaccurate data on IT and business operations.
It is important to note that timeliness is a function of accuracy and missing data equates to inaccurate data. How are you measuring the accuracy of your data? Have you ever been impacted by missing drug product changes or do not have timely access to new drug launches? If so, its time to anchor your operations around the most current data in the market.
To learn more, watch the video Evaluating Drug Data Yields Business Value.
Elsevier, the drug price leader.
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