Moves that could rein in out-of-control drug costs

October 13, 2016

The third in our series on out-of-control drug costs highlights strategies that should work to stabilize the costs of medications, so that they’re more affordable for patients.

Getting control of spiraling drug costs is a mighty and complicated task. But there are specific strategies in the works that could help rein in prices for dermatology and other medications.

MORE IN THIS SERIES:

Soaring drug costs leave derms, patients scrambling

Can costs be contained?

Among the possible strategies for tacking the high costs of prescriptions drugs in the United States, according to a recent special communication in the Journal of the American Medical Association (JAMA)1: addressing patenting and other processes that grant companies market exclusivity or limit competition; accelerating and streamlining U.S. Food and Drug Administration review for generics; enabling Medicare to negotiate drug costs; and providing information physicians and patients need to better navigate the system.

The American Academy of Dermatology Association (AADA) addresses specific stumbling blocks to patients’ access to affordable treatments in a position statement2, which suggests that complete transparency in insurance coverage policies for special brand name and generic drugs is paramount. Other issues: drug tiering needs to be based on science; not cost. Step therapy needs to be legislated, so that patients get timely access to the more expensive drugs, including biologics. And restrictive formularies and prior authorization policies need to be addressed.

RELATED: A patient's perspective

MORE: Resources for derms, patients

“The AAD Association advocates for things like fairness in step therapy, fairness in prior authorization and fairness in transparency. On the federal level, the Academy is supporting legislation that encourages a more expedited FDA approval process and more funding to develop more new breakthrough treatments…,” says Bruce A. Brod, M.D., clinical professor of dermatology, University of Pennsylvania, and the immediate past chair of the AAD’s Drug Pricing and Transparency Taskforce. Dr. Brod and colleagues authored an article on dermatology drug costs and the impact of rising medication costs in the United States, which appeared September 2016 in the Journal of the American Academy of Dermatology (JAAD)3.

Opening doors to competition

Market exclusivity prevents competition and drives up costs. It’s the primary factor allowing manufacturers to set high drug prices, according to JAMA.

To improve competition, the authors recommend limiting secondary patents for such minor changes to a patented molecule as enhanced safety or effectiveness, as well as stricter oversight of antitrust or inappropriate business practices that stifle competition.

Moves to streamline, not block, competition should also lower prices for generics, which Dermatology Times reported earlier in this series have also become cost-prohibitive. The U.S. Government Accountability Office reported in August 2016 that having a second generic manufacturer has been shown to reduce the average generic price to nearly half the brand name price4. Prices continue to fall as more manufacturers enter the market. If FDA would approve more abbreviated new drug applications, at a faster rate, it would fuel competition. A big hurdle will be fixing the FDA’s backlog for such reviews.

The prices of biologic medications, which stand out as being expensive and out of reach for many patients who might need them, could also benefit with greater competition, according to JAMA. The authors cite that the first follow-on biologic introduced in the United States, a biosimilar version of Neupogen, was 15% less expensive than the biologic originator.

Other potential price-lowering solutions

It seems the U.S. government isn’t using all its might to encourage lower drug costs.

For example, if congress were to authorize Medicare to negotiate what it pays for Medicare Part D plans, the government could use its bargaining power to potentially drive down price, according to JAMA.

Government-involved patent practices are not helping and could be hurting drug access, according to the JAMA paper. The problem is the government isn’t accessing laws that allow it to intervene when the costs of needed medicines soar out of control. One example is the use of patented products in exchange for reasonable and entire compensation, which provides manufacturers with revenues according to their investment and failure risk, while making the drug widely available at close to production cost, the JAMA authors write.

The U.S. government could also help to generate and disseminate helpful information about the comparative clinical and economic value of drugs, according to JAMA.

Greater transparency is a big issue, according to AADA, which lists transparency first in its position statement on patient access to affordable treatments.

“… the AADA supports complete transparency in insurance coverage policies for specialty, brand name and generic pharmaceuticals including copayment and coinsurance levels, and how these levels are determined,” according to the statement. “The processes utilized in setting drug prices, both specialty and generic, should be readily available and easy for patients to access. In addition, the AADA believes that patients and physicians should have access to real-time cost information available at the point of prescribing to ensure cost considerations are a meaningful part of the decision-making process.”

Information at the point of care

To help dermatologists who are AAD members make better prescribing decisions at the point of care, AAD has launched its new Drug Pricing and Access Resource Center5, which tracks drug prices and offers a drug price comparison table; shares an updated list of websites for cost and pricing information; offers the new formulary search app, which shows providers and patients which drugs are covered by specific plans; and includes a drug pricing toolkit for state societies, which helps dermatologists better advocate for drug access at the state level.6

There are nongovernmental organizations that can help patients, physicians and payers in their drug use decision-making. These include the Institute for Clinical and Economic Review, The Medical Letter (a nonprofit organization that publishes critical appraisals of new prescription drugs and comparative reviews of drugs for common diseases, according to MedicalLetter.org), the Independent Drug Information Service and Oregon’s Drug Effectiveness Review Project, according to JAMA.

The JAMA paper authors suggest that educating physicians more about medication costs and value-based prescribing and incorporating such information in electronic medical records, could empower providers at the point of care.

In the meantime, dermatologists are doing what they can in the trenches. Dermatologist Lindsey Bordone, M.D., of Columbia Doctors and assistant professor in dermatology at Columbia University Medical Center, says practice makes things slightly easier.

“For some medications, you can do a form and just fax it in. Sometimes you have to do calls, and then you get to know the buzz words of what people need to hear in order to get something covered,” Dr. Bordone says. “You just get into a system of doing this over and over again.”

Hilary Baldwin, M.D., medical director of the Acne Treatment and Research Center in Morristown, N.J., says many dermatologists have made a grid to follow to help them navigate the system. 

“Each drug has a particular method of procurement: which coupon, what tube size and what dosing schedule is allowed by each coupon, what instructions to give the patient, which pharmacy to send them to and what price to expect,” Dr. Baldwin says. “Often patients have to have failed prior treatment - treatment that we know will not work, but need to use anyway - in order to get the drug they need.”

References:

1 Kesselheim AS, Avorn J, Sarpatwari A. The High Cost of Prescription Drugs in the United States: Origins and Prospects for Reform.JAMA. 2016;316(8):858-71.

2 Position Statement on Patient Access to Affordable Treatments. American Academyt of Dermatology and AAD Association.

3 Albrecht J, Lebwohl M, Asgari MM, et al. The state and consequences of dermatology drug prices in the United States.J Am Acad Dermatol. 2016;75(3):603-5.

4 Generic Drugs Under Medicare. GAO Highlights. United States Government Accountability Office. August 2016.

5 Drug Pricing and Availability. American Academy of Dermatology.

6 Evans, C. Cost of derm drugs varies greatly depending on location. American Academy of Dermatology’s Member to Member. May 20, 2016.
 

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Resources for derms, patients

A patient's perspective

 

Resources for derms, patients

GoodRX http://www.goodrx.com/ is a free app that helps doctors and patients find the lowest available prices for specific drugs.

Blink Health www.blinkhealth.com gives users free access to lower negotiated pricing on more than 15,000 medications.

RX Assist http://www.rxassist.org/patients offers a way to find pharmaceutical company and other programs that assist patients who can’t afford specific medications.

NEXT:

A patient's perspective

 

Patient perspective

In the first article in this series on drug costs, we profiled Melissa Withem Voss, from Waukegan, Ill., a 42-year-old widow with three children, who has psoriasis and psoriatic arthritis.

Voss, a Medicaid patient, who is currently on Stelara (ustekinumab, Janssen), tried to get access to biologic medications several years ago, but was told that she would have to use step therapy. The creams and ointments didn’t work, Ms. Voss says.

“At my physical worst I was covered 97% of my body. It took having that severe of coverage for the state to agree [to a biologic],” she says.

For patients walking in her shoes, Ms. Voss suggests they talk with their doctors, first.

“Let them know the troubles you are having. Most are willing to discuss what's happening. Try to find the maker of the medication and contact them to see if they have a patient assistance program. Use the National Psoriasis Foundation as a guide. You can also try to contact your church for help. Sometimes there are groups that help with this sort of thing,” Voss says.

For physicians treating patients with psoriasis, Ms. Voss says understanding and mutual respect are important.

“Psoriasis is an expensive disease to have. It is less recognized then things like cancer. What you may consider a small copay of $25.00 is not always small for the patient. There are times that our pay checks are stretched to the last cent. We are not ignoring your instructions of our care. Some of us are even on disability or social security with payments once a month,” she says. “Our circumstances are not your problem or fault, but they are key in what we can do to help ourselves. Please have patience with us while we try to have patience with you. We are both in a position of being backed against a wall and held hostage by the ‘rules of insurance.’ Tempers may rise but, that doesn't mean that we dislike you. It means we are tired of fighting red tape, just like you. None of us asked for this disease. Please consider all your options to try to help, or maybe where to refer us.”