Contact

Payer

Pharma

Provider

Formulary guidance and transparency from P&T to point of care

Radar On Market Access: New PBM Models Respond to Public Pressure, Market Demand

Posted by Leslie Small on Dec 20, 2018

new-blog-image-sales-1

Express Scripts Holding Co. and CVS Health Corp. have in recent months unveiled new programs that appear designed to transition away from the PBM status quo, AIS Health reported.

One factor driving both new programs could be a proposed rule that's still under review by the Office of Management and Budget, which might remove prescription drug rebates' safe-harbor protections from the federal antikickback statute. But one industry expert says it looks less likely that may actually transpire.

"I think it has more to do with the fact, almost regardless of that [potential rule], that rebates going forward potentially are going to be so variable," says David Dross, the leader of Mercer's managed pharmacy practice. He says the PBMs' moves are a response to "marketplace demand" for a different type of pharmacy benefits model.

Express Scripts' new National Preferred Flex Formulary allows it to add to its formulary a newly launched lower-cost alternative to a brand medication — giving members immediate access to that drug — and lets the PBM exclude the innovator brand product from coverage.

The first drugs managed through the National Preferred Flex Formulary will be Asegua Therapeutics' authorized alternatives for the hepatitis C treatments Epclusa (sofosbuvir/velpatasvir) and Harvoni (ledipasvir/sofosbuvir).

Under CVS's new Guaranteed Net Cost model, the company will pass 100% of rebates to plan sponsors and "take accountability for the impact of drug price inflation and shifts in drug mix," the company said in a press release.

Though the models differ in design and scope, Dross says similar forces are driving them. "I think there's so much buzz in the marketplace around rebates, and what they are or aren't," he says. "People are becoming more conversant about it, so what that does is it sort of shines a light on all of the various entities in the supply chain, including pharma manufacturers."

In response to that, manufacturers are experimenting with different approaches to pricing, which move away from the high-list-price, high-rebate paradigm, he explains. "And it kind of puts the pressure on the PBMs to say, 'gee, well, how do we deal with that or address that?'" Dross adds.

Express Scripts' new formulary is "directly dealing with that particular dynamic," he says, while CVS's model is more of a broad-based approach that signals to the market it's open to trying something new and taking on risk.


Subscribe to the MMIT blog for more pharma, provider, and payer perspectives on key topics that affect the healthcare network.

Subscribe for Weekly Perspectives

Topics: Industry Trends, Payer, Specialty, Provider, Data & Analytics