Prescription Drug Utilization & Opioid AbuseJuly 16, 2013

Mona Chitre, PharmD, CGPVice President, Pharmacy Management

Excellus BlueCross BlueShield

Pharmacy Management: Market Landscape

• Impact of Prescription Benefits

• Specialty Medications

• Price Increases

• Trend Management Opportunities

• Opioids

Service Bucket PMPM Allowed: Rx extracted from buckets and consolidated

Drug (Rx and Medical Benefits) $ 94.03

Physician $ 93.44

Outpatient $ 70.93

Inpatient $ 60.96

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

How does Rx affect benefit plans?

Medical Benefit• Hospital • Physician Office• Outpatient Facility• Clinics• Infusion centers • Home Infusion• DME

• Drug Costs: 5-8% of total medical cost ($20-$25 pmpm)

Pharmacy Benefit• Retail Pharmacy• Mail Pharmacy • Specialty Pharmacy

• Drug Cost : 20-25% of total health care cost ($75-$85 pmpm)

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

Today’s pharmaceutical benefit reality

$20 – generic Rx

$2,200 – specialty Rx

$200 – brand Rx

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SPECIALTY PHARMACEUTICALS

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

Drug Condition Annual Cost

Vectibix

Cancer $100,000

Enbrel Rheumatoid Arthritis

$16,000

Cinryze Hereditary Angioedema

$450,000

Juxtapid

Familial High Cholesterol

$1,000,000

Top Ten Drug Projections

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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

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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

“Cancer Trends Demand Call To Action”

The Tipping Point

“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”

• Zaltrap v. Avastin – Same Efficacy – $11,000 difference

Cost Trends

DrugManufacture

rRout

eIndication Approval

Launch (est)

Annual Cost

Inlyta (axitnib)

Pfizer OralAdvanced renal cell carcinoma

1/27/2012 2/1/2012 $75,000/yr

Erivedge (vismodegib

)Genentech Oral Basal cell carcinoma 1/30/2012 2/7/2012 $75,000/yr

Kalydeco (ivacaftor)

Vertex Oral Cystic Fibrosis 1/31/2012 2/7/2012$294,000/

yrKorylm

(mifepristone)

Corcept Oral Cushings Disease 2/17/2012 5/1/2012$180,000/

yr

Elelyso (taligluceras

e alfa)Pfizer/Protalix IV Gaucher Disease 5/2/2012 5/3/2012

$180,000/yr

Perjeta (pertuzuma

b)Genentech IV

HER2-positive Breast CA

6/11/2012 6/25/2012 $71,000/yr

Juxtapid (pertuzuma

b)Aegerion Oral

Familial High Cholersterol

12/21/2012

2/1/2013 $1,000,000

Kadylca(traztuzuma

b emtansine)

Genentech IV HER2-positive Breast CA 2/22/2013 $94,000

2012/2013 Sample Specialty Rx Approvals

Pricing and Price Increases

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Case Study: Multiple Sclerosis New Technology: 2010: 2 New agents - 1st Combination drug and 1st Oral Agent

Significant Price Increases: • 2006 Price - $ 15,000• 2010 Price - $37,000

Mean Ingredient Cost Copaxone Compared with CPI

$1,000

$1,200

$1,400

$1,600

$1,800

$2,000

$2,200

$2,400

$2,600

$2,800

$3,000

2004Q

1

2004Q

2

2004Q

3

2004Q

4

2005Q

1

2005Q

2

2005Q

3

2005Q

4

2006Q

1

2006Q

2

2006Q

3

2006Q

4

2007Q

1

2007Q

2

2007Q

3

2007Q

4

2008Q

1

2008Q

2

2008Q

3

2008Q

4

2009Q

1

2009Q

2

2009Q

3

2009Q

4

2010Q

1

2010Q

2

COPAXONE

Consumer Price Index

METRIC EHP 2 year Trend

COST 40%

USE 16%

Drug Cost Trends: Upstate New York

2006 2007 2008 2009 2010 2011$0.00

$50.00

$100.00

$150.00

$200.00

$250.00

$19.63 $18.30 $19.12 $18.68 $19.28 $18.16

$120.05

$135.58

$155.04$167.74

$185.89

$208.38

$100 Difference

$190 Difference

Average brand name drug cost *

Average generic drug cost *

Trend Management: GENERICS

“Ask your doctor if a generic is right for you”

Each 1 point increase in GFR can reduce Rx spend by 2-3%

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

201301 201302 201303 201304$0.00

$40.00

$80.00

$120.00

$160.00

Managed Managed Trend

Unmanaged Unmanaged Trend

To

tal

$ P

MP

M 20.5%

• Rx management programs: Generic Trial Program, Prior Authorization and Step Therapy encourage equally effective lower cost options to help manage trend and lower member out of pocket cost.

• Groups with unmanaged Rx are incurring significantly higher Per Member Per Month (PMPM) costs than groups with managed Rx benefits

Measure Managed Rx Unmanaged Rx

Generic Fill Rate 85.6% 74.2%

Brand PMPM $54.38 $102.09Brand PMPM Trend 0.4% 26.7%

Generic PMPM $24.42 $30.11

Generic PMPM Trend -9.2% 2.5%

Total PMPM $78.80 $132.20Total PMPM Trend -2.6% 20.5%Est Annual Spend $2,124,289 $3,237,091 Data based on claims incurred January – April 2013

Trend Management: Use Management

Opioid Impact

“Overdoses involving prescription painkillers are at epidemic levels and now kill more Americans than heroin and cocaine combined.

States, health insurers, health care providers and individuals have critical roles to play in the national effort to stop this epidemic of overdoses while we protect patients who need prescriptions to

control pain.”

CDC Director Thomas Friedan M.D., M.P.H.

Although evidence is limited, chronic opioid therapy (COT) can be an effective therapy for carefully selected and monitored patients

with chronic non-cancer pain (CNCP).

The American Pain Society and the American Academy of Pain Medicine expert panel

Balancing the need for opioids

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Statistics• Overdose deaths involving opioid pain

relievers (OPR) have increased and now exceed deaths involving heroin and cocaine combined. OPR involved in 14,800 deaths in 2008

• More ED visits related to misuse or abuse of pharmaceuticals compared to use of illicit drugs

• By 2010, enough OPR were sold to medicate every American adult with a typical dose of 5 mg of hydrocodone every 4 hours for 1 month

• 17 percent of teens say they have used a prescription medicine at least once in their lifetime to get high or change their mood.

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74%

26%

Prescription Drug Overdose Deaths,

2008

OPR Overdose Deaths

Other Rx Drugs

* Significantly lower than 2009 levels

Impact to Stakeholders in Healthcare

• 40 people die every day from overdoses involving opioids such as hydrocodone, oxycodone and oxymorphone

• The average annual cost per capita for opioid abusers has been calculated at $16,000 compared to $1,800 for non-abusers

• Nonmedical use of OPR costs insurance companies up to $72.5 billion annually in health-care costs

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Wasted healthcare dollars

Excellus BlueCross Blue Shield Team

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ClinicalPharmacy ManagementMedical DirectorBehavioral Health

Non-ClinicalSpecial Investigations UnitData AnalyticsCommunications

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Integrated

Approach

Identification and

Stratification

Opioid Mailing

Suboxone® Initiative

Align Formulary

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Prescribing Summary - Cover Letter

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Example Report

Results of Opioid Mailing

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Pharmacy Billing Errors

Fraudulent RXs by MD

staff

Stolen Prescriptio

n Pads

Negative Urine Drug

Screen

Suboxone® Provider testament

Provider survey

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88%

12%

Was mailing helpful?

Yes

No

41%

59%

Did you take action?

Yes

No

Contacted other pre-

scriber

Contacted insurance company

Contacted patient listed

Contacted pharmacy

0%

5%

10%

15%

20%

25%

18.50%

1.50%

21.60%

9.10%

Action Taken

32.4%

61.3%

6.3%

What frequency of mailing is appropriate?

More frequently

Same

Less frequently

Based on 330 respondents

Step Three - Promoting Outpatient Detoxification• Suboxone® - Under the Drug Addiction Treatment Act (DATA), limited to

physicians who meet certain qualifying requirements (authorized training, addiction medicine specialty)

• Physician Engagement: – Upstate New York has a shortage of physicians who can prescribe Suboxone®

for opioid dependence

• Advantages of therapy:– Withdrawal symptoms can be managed safely and effectively in their home

environment that incorporates support from the family.– Significant MEDICAL cost savings. Medical costs associated with inpatient

detox can cost upwards of $1,200/day. Outpatient detox costs the health plan less than $300/day (excluding drug costs).

• Disadvantages of therapy:– High cost– Inappropriate use

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Results

Decrease in inpatient detoxification by 10 percent over a two year time period (2009 – 2011)

Approximate 22% savings in Medical costs for the same time period

Significant increase in members utilizing Suboxone® therapy.

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2009 2010 2011, est $-

$1,000,000

$2,000,000

$3,000,000

$2,194,857

$2,016,609

$1,718,065

Detox Medical Claims Expense

Last Thoughts

Insurers — the bad guys in so many policy debates — can do a lot of good, keeping better track of the

number and types of controlled substances policyholders are receiving.

The New Drug Crisis: Addiction by Prescription

Time Magazine

Monday, Sept. 13, 2010

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