Three New Specialty Pharmacy Deals Signal The Boom Ahead

There have been three major specialty pharmacy announcements over the last week.

• Long term care pharmacy Pharmerica acquired a minority stake in fast-growing specialty pharmacy Onco360

• Express Scripts opened up its specialty pharmacy network to physicians in the RainTree Oncology network

• Grocery chain Giant Eagle bought Rx21, a small transplant/hepatitis C specialty pharmacy

Pay attention. As these deals show, the specialty market is getting even hotter. Everyone wants specialty drug revenue. Read on to find out who’s moving in.

PharMerica Targets Onco360

Yesterday, long term care pharmacy PharMerica Corp. acquired a minority stake in oncology specialty pharmacy Onco360. Read the press release.

As we highlighted in September, Onco360 is the fifth fastest-growing specialty pharmacy. See Say Hello to the 12 Fastest-Growing, Private Specialty Pharmacies. Onco360's 2012 revenues were $112.2 million, up $19.4 million (+24%) vs. 2011.

Who else will be picked off the shopping list? Sing along with me: “We’ve been waiting for you. Take a step that is new. The specialty space needs your face.”

RainTree Oncology Joins Express Scripts

Last week, RainTree Oncology Services announced that its physician practices members will become part of Express Scripts’ pharmacy network. Hint: those who follow @DrugChannels heard this news from us last Friday.

The projected growth of the specialty pharmacy market continues to draw more dispensers. As we understand the transaction, the physician offices are now "specialty network" pharmacies for Express Scripts' clients (plan sponsors). Since many practices were already dispensing oral oncology products, this deal creates a more consistent structure for the physicians.

Such deals will reduce payer pressure to shift products to central-fill, PBM-owned specialty pharmacies. As we pointed out in Oral Oncology Battle: Payers vs. Providers, many physicians are already expanding their dispensing (“on-site retail”) volume.

Giant Eagle Grabs Rx21

Almost one year ago, Kroger made its big specialty pharmacy play. As the year comes to a close, another big supermarket player is joining the specialty sector fun.

Giant Eagle swooped in and acquired Rx21 Specialty Pharmacy, a small (revenue unknown) company focused on organ transplant and hepatitis C.

There is a new wave of oral direct-acting anti-viral agents. Janssen’s Olysio (simeprevir) was released in late November, and Gilead’s Sovaldi (sofosbuvir) was released last week. Both of these treatments have produced exceptional sustained virologic rates (SVRs) in clinical trials in patients with varying genotypes, so there is a lot of interest in capturing revenue from these treatments. There are a few important treatments for the condition still in development, and hepatitis C spend will increase dramatically.

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Will anyone else put a specialty pharmacy deal in their holiday shopping cart? Stay tuned to see if three’s company or not.