Things to Watch in 2016's Drug Channels

Whew. It was quite a year—one filled with big deals, big news, and a very memorable lap dance from the incomparable Amy Schumer! (Plus, we raised $8,000 for charity!)

Drug Channels had another big year. We now have more than 12,000 subscribers, including almost 2,400 @DrugChannels Twitter followers. In 2015, total page views will exceed 700,000—up 20% compared with 2014.

Thank you for welcoming me into your inboxes and browsers. I’ve had fun and hope you did, too. I’m grateful to our many sponsors and guest writers. Special thanks to the brave souls who joined in the spirited discussions below the articles.

Below you’ll find a bonus stocking stuffer: the Drug Channels Update: Things to Watch in 2016 slides from my recent keynote presentation to a group of trade and channel executives from pharmaceutical manufacturers. It’s a sneak peek at some of next year's likely hot topics.

Drug Channels will return in 2016! In the meantime, please enjoy a video of me dancing with Paula, my wife and business partner.

Wishing you and your family health and happiness,
Adam

Walgreens and Valeant Devise a New Twist on Preferred Pharmacy Networks

Walgreens Boots Alliance (WBA) and Valeant Pharmaceuticals just announced a very intriguing preferred pharmacy network for Valeant’s branded products. Patients and payers will pay lower prices for Valeant products that are filled at Walgreens or other to-be-named-later independent pharmacies. Read the press release. (I presume we’ll learn a lot more about the deal at Valeant’s investor meeting today.)

Read on for my observations on this novel arrangement. The deal offers clear business benefits for both companies—while helping them overcome their respective PR deficits. With this preferred network arrangement, both Valeant and WBA get to do a partial end-run around payers. What’s more, it suggests that a new marketing model for generic prescriptions could emerge.

I’m not so sure, however, that payers and pharmacy benefit managers (PBMs) will be so enthusiastic about these channel innovations.

Drug Channels News Roundup, December 2015: AmerisourceBergen, Pharmacy Pricing, AMP Final Rule, and Walgreens

December at last! It’s time for our final news roundup of 2015. Before you hit the mall, check out this hand-picked selection of notable news stories from around the Drug Channels universe.

• AmerisourceBergen CEO Steve Collis reflects on his first four years

• Beware! Consumers should watch out for overpriced pharmacies

• Will Santa bring us the Average Manufacturer Price (AMP) Final Rule?

Plus, the Walgreens Community Theater Players perform an unintentionally hilarious skit touting preferred pharmacies in Medicare Part D. As my kids say: LOL.

P.S. For news and other stuff that I find cool and interesting, follow @DrugChannels on Twitter.

Patient Assistance & Access Programs

PAP 2016 – 17th Patient Assistance & Access Programs
March 8-9, 2016 | Baltimore, MD
www.cbinet.com/PAP

Now in its 17th year, CBI’s Patient Assistance and Access Programs PAP Meeting remains the largest and most meaningful meeting of its kind for manufacturers, co-pay foundations, non-profits, free clinics, advocacy organizations, hospitals and service providers working on meeting the needs of the uninsured and underinsured population. Join CBI for action-oriented discussions, community-based dialogue and the opportunity to weigh in on points of progress that need to transpire moving forward.

This year’s meeting provides pivotal insights from more than 60 of the nation’s leading experts on strategies for reaching beyond traditional models for patient assistance and access.

For more information, please download the complete agenda or visit www.cbinet.com/PAP. Drug Channels readers will save $400 off of the standard registration rate when they use code JQZ974.*

*Cannot be combined with other offers or used towards a current registration. Cannot be combined with special category rates or applied to non-profit pricing – non-profit groups should contact Roberts Apse at Roberts.Apse@cbinet.com or 339-298-2290 for special rates. All discounts are taken off the full, standard rate. Other restrictions may apply.

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The content of Sponsored Posts does not necessarily reflect the views of Pembroke Consulting, Inc., Drug Channels, or any of its employees.

Five Fun Facts: The Newest Prescription Drug Spending and Payer Data

Last week, the econowonks at the Centers for Medicare & Medicaid Services (CMS) released the 2014 National Health Expenditure data, which are the definitive source for U.S. healthcare spending data. Savor the numbers in the Health Affairs article National Health Spending In 2014: Faster Growth Driven By Coverage Expansion And Prescription Drug Spending. (Free download)

In 2014, net spending on outpatient prescription drugs hit $297.7 billion. For the first time since 2009, drug spending growth exceeded national healthcare spending growth. Below, I delve into who paid for these prescription drugs. A big surprise: Public sources exceeded employer-sponsored private insurance for the first time since the 1960s.

On the plus side, due to data revisions, 2014 drug spending was $7.4 billion less than CMS had projected back in July.

Read on for my detailed look at trends in who really pays for our country's prescriptions drugs.

Five Industry Trends for U.S. Drug Wholesalers

Modern Distribution Management just published my article 2015 MDM Market Leaders | Top Pharmaceuticals Distributors. It is an excerpt from the 2015-16 Economic Report on Pharmaceutical Wholesalers and Specialty Distributors.

Below, I republish the section highlighting five significant industry trends affecting the U.S. drug wholesaling industry. I think Drug Channels readers will enjoy this summary.

Tomorrow, I'll be giving the keynote address at CBI's 11th Trade and Channel Strategies conference. Hope to see you there!

Bonus wholesaler trivia question: In 2010, which prominent drug wholesaler CEO wanted Donald Trump to run for President? (Answer below!)

PBMI 21st Annual Drug Benefit Conference

PBMI 21st Annual Drug Benefit Conference
February 29 - March 2, 2016 | Palm Springs, CA
Location: The Westin Mission Hills Golf Resort & Spa Hotel

PBMI invites you to join them next year for our 21st Annual Drug Benefit Conference.

Drug Channels readers will save $355 off conference rates when they register online and use code PC2016.

The event will hit the ground running with an innovative opening keynote by Dr. Daniel Kraft. Dr. Kraft, a progressive physician, will examine rapidly emerging, game changing, and convergent technology trends and how they are and will be leveraged to change the face of health care and the practice of medicine in the next decade.

With more than 20 sessions, you’ll gain insight into practical and proven strategies for effectively managing the drug benefit. The conference will include three educational tracks. Check out the conference program to see who will be there.

Conference attendees can also maximize their learning experience by selecting one of two pre-conference workshops to attend. Both workshops are free of charge and will be held February 29 from 10:30 am to 12:00 pm (lunch included).

Workshop A: The Total Medical Costs of the Hepatitis C Virus in Commercial and Managed Medicaid Populations
Sponsored by Primrose Healthcare

Workshop B: Delivering the Right Information to the Point of Care
Sponsored by Surescripts

Note: You must be registered for the conference to attend a workshop.

For more Information: Contact Linda DeChant at ldechant@pbmi.com.

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The content of Sponsored Posts does not necessarily reflect the views of Pembroke Consulting, Inc., Drug Channels, or any of its employees.

Optum, Aetna, Cigna and Prime Therapeutics Join the PBM Formulary Exclusion Party

Ronny Gal, a Senior Analyst at investment bank Sanford C. Bernstein & Co., just published an excellent analysis of the latest formulary exclusion moves by the biggest pharmacy benefit managers (PBMs).

Ronny and his team found that four more companies—OptumRx, Aetna, Cigna, and Prime Therapeutics—will introduce or significantly expand formulary exclusions in 2016. Combined with the actions of Express and Caremark, they estimate that more than 50% of the commercial market will have access to exclusion lists.

Below is their summary of 2016 exclusion lists, by therapeutic area. Their analysis confirms my view that exclusions are the new normal. Expect continued growth in these lists, as payers scrutinize manufacturers’ copay card strategies in a post-Valeant market.

New OIG Report Shows Hospitals’ Huge 340B Profits from Medicare-Paid Cancer Drugs

The Office of Inspector General (OIG) has just released another eye-opening report on the 340B drug discount program: Part B Payments For 340B-Purchased Drugs. (Free download)

The report documents how 340B-eligible hospital outpatient departments earn tremendous profits from the Medicare Part B program. Physician offices, which also receive Part B reimbursements, are not as fortunate.

The OIG focuses on how the Medicare program could save money by sharing in these mega-profits. But as my summary chart below shows, Medicare appears to be providing incentives for shifts in cancer care treatment locations.

As usual, we don’t know if needy patients are benefiting from hospitals’ excess Medicare 340B profits. The OIG even reminds us three times in its report: “The 340B statute does not restrict how covered entities may use these funds.” Unfortunately, the Health Resources and Services Administration’s recent Omnibus Guidance didn’t bother to require that hospitals use 340B funds help the neediest patients access valuable medicines. Money, so they say, is the root of all evil today.

Specialty Therapies 2016

Specialty Therapies 2016
January 28-29, 2016 | Planet Hollywood | Las Vegas, NV

Join healthcare and pharma thought leaders on January 28-29 in Las Vegas for Specialty Therapies 2016  – the highly acclaimed meeting that brings about critical discussions on balancing costs, access, and quality for management of specialty drugs.

DIALOGUE LED BY KEY THOUGHT LEADERS:

Avella Specialty Pharmacy | Blue Cross Blue Shield of Massachusetts | Blue Cross and Blue Shield of Minnesota | Blue Cross and Blue Shield of North Carolina | Denver Health Medical Plan | Fairview Specialty Pharmacy | Florida Blue | Gorman Health Group | Horizon Blue Cross Blue Shield New Jersey | Independent Health | NSHOA Cancer Centers in NY | Rutgers RWJ Medical School | Walgreens | Walmart | Widener University

DISCUSSIONS ON SPECIALTY THERAPY INDUSTRY HOT TOPICS:

Specialty Product Market Trends | Value-Based Reimbursement Programs | Patient Support Services for Limited Distribution Drugs | Therapy Usage Management | Plan Coordination with 340B Pharmacies | Medicaid and Medicare Updates | Specialty Pharmacy Cost Containment | Biosimilars | Oral Oncolytics | Specialty Pipeline Management | And More!

For more information, please download the complete agenda or visit www.cbinet.com/specialtytherapies. Drug Channels readers will save $200 off of the standard registration rate when they use code TAT246.*

*Cannot be combined with other offers or used towards a current registration. Cannot be combined with special category rates. Other restrictions may apply.

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The content of Sponsored Posts does not necessarily reflect the views of Pembroke Consulting, Inc., Drug Channels, or any of its employees.

Take the DCI Economic Reports Survey...and Win a Free Report!

I want to know what you think of Drug Channels Institute's (DCI) economic reports and how I can improve them.

Click here to take the DCI Economic Reports Survey

What's in it for you? Well, just answer a few brief questions—the survey should take 5 to 10 minutes, tops—and you could win a free Drug Channels Institute report.

You can answer anonymously. But if you provide an email address, you'll be entered in a drawing to win a free corporate license of our forthcoming 2015-16 Economic Report on Retail, Mail, and Specialty Pharmacies, which will be released in February 2016. If you win, you'll be one of the first people to get this new report!

Any information you provide will be held in the strictest confidence. Per Drug Channels' long-standing policy, I never publish, release, or disclose any personal data without your permission.

Thanks in advance for helping me help you. I read EVERY response, so don't be shy.

P.S. Have a Happy Thanksgiving!

I hope you enjoy time with your family...along with a traditional meal of toast, popcorn, pretzels, and jelly beans!

Expanded Access Programs 2016

Expanded Access Programs 2016
February 23-24, 2016 | Washington, DC
www.cbinet.com/expandedaccess

Current legislation is quickly paving the path for easier patient access to experimental, unapproved drugs. CBI’s Expanded Access Programs is the industry’s leading event dedicated to the nuances and complexities of designing and implementing early access programs. This multi-stakeholder event is focused on U.S. and global models for a variety of access management programs, including, but not limited to:

Expanded Access Programs, Early Access Programs, Compassionate Use Programs, Named Patient Programs and Managed Access Programs.

The FDA and a broad array of key stakeholders are coming together for an in-depth and meaningful discussion on Expanded Access Programs where the implications, prevailing policies and current industry approaches are discussed in detail. Don’t miss the opportunity to join your peers and share best practices around providing investigational, pre-launch or end-of-lifecycle drugs to patients for treatment purposes.

Visit www.cbinet.com/expandedaccess for more information.

Speakers Include Representatives from:

FDA | National Organization for Rare Disorders (NORD) | Pfizer | Dyax Corporation |Prothena Biosciences, Inc. | King & Spalding LLP | Idis Managed Access | AstraZeneca | Biotechnology Industry Organization (BIO) | Ultragenyx Pharmaceutical | Max Cure Foundation, Inc. | Ax-S Pharma | ALS Emergency Treatment Fund | Halozyme Therapeutics, Inc. | Amgen | Canadian Organization for Rare Diseases (CORD)

Drug Channels readers will save $400 off of the standard registration rate when they use code SNH248.*

*Cannot be combined with other offers or used towards a current registration. Cannot be combined with special category rates. Other restrictions may apply.

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The content of Sponsored Posts does not necessarily reflect the views of Pembroke Consulting, Inc., Drug Channels, or any of its employees.

After the Valeant-Philidor Blowup, PBMs Clamp Down on Network Pharmacies

The initial fallout from the Valeant-Philidor kerfuffle has hit the pharmacy industry. Over the past few weeks, the major pharmacy benefit managers (PBMs) have begun dropping pharmacies from their networks. Some PBMs are also reminding retail pharmacies that they are prohibited from acting as mail pharmacies.

Below, I highlight the high-profile network pruning by the top three PBMs—Express Scripts, the Caremark PBM business of CVS Health, and the OptumRx business of UnitedHealthcare. I also speculate on the factors that would lead a PBM to clash with a pharmacy in its network.

An as-yet-unanswered question: If PBMs routinely monitor their networks, why did it take a highly publicized pharmacy meltdown before PBMs finally cracked down?

Independent Pharmacy Economics: Profits Steady, but Sales Down (Maybe)

Time for my annual look at independent pharmacy owners’ business economics, drawn from the recently released 2015 National Community Pharmacists Association (NCPA) Digest, Sponsored by Cardinal Health. Here's the press release: NCPA Digest: Adherence, Diversified Revenue Critical for Community Pharmacies.

The data reveal that independent pharmacy owners are doing better than you might expect. In 2014, the average pharmacist owning a single pharmacy earned about $228,000. The number of independent pharmacies continues to hold steady.

In the NCPA Digest sample, average per-prescription revenue declined, which reduced gross profits and average prescription revenues. On the other hand, IMS Health data imply independents' revenue and prescriptions are growing, not declining. Hmmm.

As always, I welcome your constructive and civil comments. Please remember our Drug Channels philosophy, courtesy of the late senator Daniel Patrick Moynihan: "Everyone is entitled to his own opinion, but not his own facts."

sPCMA Business Forum

A MESSAGE FROM sPCMA

Connect with Specialty Pharmacy’s Most Influential Leaders

The sPCMA Business Forum attracts the highest number of executives and decision makers from PBMs and the nation's largest specialty pharmacies of any industry conference. The sPCMA Business Forum is a networking and educational conference designed for professionals of all levels engaged in the business of specialty pharmacy and pharmaceutical care.

Register now!

2016 sPCMA Business Forum
February 8 & 9, 2016
JW Marriott Orlando, Grande Lakes | Orlando, FL

Conference features include:

• Presentations by C-suite and other senior PBM, specialty pharmacy and pharma executives;
• Timely and thought-provoking CPE sessions;
• Dedicated time and facilities for private meetings;
• Pre-conference networking through PCMA-Connect; and
• Networking receptions with members and conference sponsors.

Who Should Attend
Anyone interested in attending is welcome. The 1,300 attendees will range from C-suite executives to mid-level professionals tasked with all aspects of the business of specialty pharmacy. Companies in attendance will include specialty pharmacies of all sizes and composition, PBMs, manufacturers, wholesalers and distributors, consultants, vendors, and other specialty pharmacy stakeholders.

Contact PCMA
Please contact Jenny Dawson with questions or to request information about the Affiliate Program or conference sponsorships.

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The content of Sponsored Posts does not necessarily reflect the views of Pembroke Consulting, Inc., Drug Channels, or any of its employees.

Drug Prices, Manufacturer Rebates, and the Risk to Channel Economics

Here’s a Drug Channels Zen koan for you: When does a price increase not increase the price?

This riddle came to me while reviewing the excellent new Pharmaceutical Research and Manufacturers of America (PhRMA) slide deck called Prescription Medicines: Costs in Context. (Free download.) The slides argue—persuasively, I believe—that pharmaceuticals have been undervalued as a source of health benefits and unfairly maligned as the key driver of costs.

One important slide, reproduced below, is definitely worth your time. Despite the growth in drug list prices, manufacturers are experiencing limited growth in net revenues, which deduct payer rebates. As the data show, this difference has grown sharply over the past two years. I also present data from a separate Medicaid analysis, which tells a similar story.

Meanwhile, drug list price increases are boosting revenues at drug channels companies—pharmacies, wholesalers, and PBMs. These intermediaries are still compensated on gross (not net) revenues. I wonder: Will the growing gross-to-net disparity make current channel economic arrangements unsustainable for wholesalers and pharmacies?

EXCLUSIVE: How the Eight Biggest Retail Chains (and Independents) Are Participating in 2016's Part D Preferred Networks

In a previous exclusive analysis (In 2016, 85% of Medicare Part D plans have a preferred pharmacy network), I highlighted the plans whose preferred pharmacy networks will dominate next year’s Medicare Part D prescription drug plans (PDP).

Today, I examine retail chains in the biggest Part D networks. Walmart and Walgreens lead the pack in preferred network participation. CVS remains conservative, while Rite Aid has opted out. In most plans, independents feature prominently as preferred pharmacy options.

Preferred networks are crucial for understanding drug channel economics. Pharmacies compete to be in these networks, so the cost savings come from lower pharmacy profits. And Medicare Part D accounts for more than one-quarter of the outpatient prescription market. Read on for our exclusive, Evil Dead inspired look at 2016’s preferred network participants.

Hub and SPP Model Optimization

CBI’s 6th Hub and SPP Model Optimization
February 23-24, 2016 | Philadelphia, PA
www.cbinet.com/hubs

CBI’s Hub and SPP Model Optimization Summit has earned strong acclaim from hundreds of biopharma manufacturers for its focus on cutting-edge content and next generation issues impacting HUB model design, streamlined patient access and specialty pharmacy network strategy. Benefit from expert insights from all key stakeholders including manufacturers, specialty pharmacies, hubs, payers, PBMs, physicians and hear robust discussion around the most pressing topics related to hub and SPP model optimization.

Stakeholders providing expert insight include representatives from ARIAD Pharmaceuticals, Biologics, Blue Cross Blue Shield of Michigan, Churchill Pharmaceuticals, CoverMyMeds, Diplomat Specialty Pharmacy, Independent Health, Geisinger Health Plan, Grifols, Incyte Corporation, Infinity Pharmaceuticals, Intarcia Therapeutics, Jazz Pharmaceuticals, Lash Group, a part of AmerisourceBergen, Omnicare Specialty Care Group, PANTHERx Specialty Pharmacy, Practice Accreditation®, ProMetrics, Raptor Pharmaceuticals, Therigy, Triplefin, Turing Pharmaceuticals, UBC, URAC, Veloxis Pharmaceuticals and VirMedica.

Don’t miss this timely meeting as you prepare to launch, transition or reboot your corporate or product approach to hub services.

For more information, please download the complete agenda or visit www.cbinet.com/hubs. Drug Channels readers will save $400 off of the standard registration rate when they use code JSH345.*

*Cannot be combined with other offers or used towards a current registration. Cannot be combined with special category rates. Other restrictions may apply.

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The content of Sponsored Posts does not necessarily reflect the views of Pembroke Consulting, Inc., Drug Channels, or any of its employees.

Drug Channels News Roundup, November 2015: Walgreens Boots Alliance, Diplomat Pharmacy, CVS Health, and Aetna (sort of)

Given last week’s big news, I had to skip my usual monthly news roundup. This selection may be a bit tardy, but the articles are certified fresh:

• A revealing interview with Walgreens Boots Alliance CEO Stefano Pessina

• The CEO and CFO of Diplomat Pharmacy both defend the specialty pharmacy industry with clarity and wit

• CVS Health argues for pharmacy-health system partnerships

Plus, Aetna allows newlyweds to register for medical procedures. Now, that’s disruptive innovation!

P.S. For timely updates on stuff that I find cool and interesting, follow @DrugChannels on Twitter.

Four Fun Facts About the Walgreens-Rite Aid Merger Agreement

Late last week, Walgreens Boots Alliance (WBA) filed an 8-K with the full text of its merger agreement with Rite Aid. Click here to read it.

The document containing the Agreement and Plan of Merger weighs in at a hefty 137 pages. Below, I highlight four fun facts about the deal’s timing, its termination fees, and what the companies will do to achieve antitrust approval.

WBA also released a new slide deck summarizing a bit more about its strategic rationale for the deal. Excerpt below.

For background on the merger, please see our Walgreens-Rite Aid Deal: Ten Things You Should Know. But you've already read that article, right?

eyeforpharma December Forum: Registration Deadline This Week

eyeforpharma Real World Evidence & Market Access Summit 2015
December 3-4, 2015 | Philadelphia, PA
www.eyeforpharma.com/rwe/

ENTER “4318DC300” to save $400 off any pass–this week only!

You know it and have read it here before: pharma leaders in data, HEOR, and market access need to come together to collaborate with health systems and physician leaders.

The 4th annual Real World Evidence & Market Access Summit on December 3-4 will be big pharma’s last opportunity to shape the evidence strategy for 2016 – and the only one with all stakeholders present.

Here’s why the event is a must-attend:

1. Payer/provider panel discussions: Talk risk-based contracting and discover directly how access and formulary decisions are evolving from the customer point of view. Hear from Jerrold Penso, Chief Medical & Quality Officer, AMGA and Steve Chick, Vice President, Comprehensive Health Insights, Humana
2. 15+ major health systems: Explore new opportunities for data and evidence collaboration and meet directly with health systems. Engage with change-makers such as Eric Newman, Chief of Specialty Care Innovation & Integration, Geisinger
3. 1 event, 5 tailor-made tracks: Choose from a menu of opportunities – plan each day around the insights that matter most to you (real world analytics, HEOR, market access, organizer customer groups and data partnerships)

See the Program for all Session Details NOW

HIGH-LEVEL DELEGATES

Attendees learn as much from the world-class speaking faculty as they learn from their peers. Recent registrants include:

1. Clément François, Vice President, HEOR, US Lundbeck
2. Faisal Mehmud, Vice President, Medical Affairs, Novartis Oncology
3. John Hernandez, Global Vice President, HEOR, Abbott
4. Garret Ingram, Vice President, Head of US Market Access, Sanofi
5. David Tomala, Senior Director, Advanced Analytics, Express-Scripts
6. Mark Weiner, Chief Medical Information Officer, Temple University Health System

Get the Complete Line-Up Here

We’ve already confirmed dozens senior participants from: Novartis / Otsuka/ Janssen Pharmaceuticals/ Hoffmann-La Roche/ UCB/ Bayer/ Novo Nordisk/ Daiichi Sankyo/ Genentech/ AbbVie/ Millennium / DSI/ Takeda/ Oracle / J&J/ Mount Sinai/ Geisinger/ Pfizer/ EMD Serono/ Shire / SAS/ Eisai…

For those who like to stay ahead of the curve in showing drug value, this is a must-attend.

REGISTER BEFORE LAST CHANCE AND SAVE WITH DRUG CHANNELS DISCOUNT:

ENTER “4318DC300” here and save $400 off any pass – this week only!

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The content of Sponsored Posts does not necessarily reflect the views of Pembroke Consulting, Inc., Drug Channels, or any of its employees.

The Walgreens-Rite Aid Deal: Ten Things You Should Know

Wow. Walgreens Boots Alliance is acquiring Rite Aid. As I told The New York Times: “The pharmacy consolidation endgame has begun.”

Read on for my analysis of the deal and what it means.

Feel free to add your own thoughts in the comments below. (Yes, you can comment anonymously.)

Valeant, Philidor RX, and the Uninformed Attack on Specialty Pharmacy

Yesterday, Valeant Pharmaceuticals finally explained its complex interactions with Philidor RX Services, a so-called “specialty pharmacy” that has a previously-undisclosed financial relationship with Valeant. Click here to see the full 89-slide webcast deck. Valeant has been labeled the “Enron of the pharmaceutical industry,” although I don’t know if any of the alleged shenanigans are true.

Unfortunately, the controversy has tarred the entire specialty pharmacy industry along with manufacturers’ legitimate specialty pharmacy relationships. Below, I explain why Philidor RX is not a specialty pharmacy. I also suggest what the Valeant-Philidor relationship could mean for payer surveillance of manufacturers’ copay offset programs.

I believe (hope?) that over time, everyone will recognize the differences between a true specialty pharmacy and a company such as Philidor. Meanwhile, expect greater scrutiny of manufacturers’ specialty channel strategies. Smaller independent specialty pharmacies should also expect greater oversight, as manufacturers and payers work to validate the business operations of their trading partners.

eyeforpharma Customer Engagement USA Summit 2015

eyeforpharma Customer Engagement USA Summit 2015
November 19-20, 2015 | Philadelphia, PA
www.eyeforpharma.com/customer-engagement/

At eyeforpharma’s 3rd annual Customer Engagement Summit, attendees will learn how to engage their key customers through a wide range of channels - from digital to F2F. The speaker faculty selected from both inside and outside the industry will focus on truly intelligent engagement strategies that start with the customer and end with the channel.

Drug Channels readers will save $300 off the standard registration rate when they register with discount code 2772DC300.

Speakers include:

• Jim De Lash, Director Multi-Channel Marketing Execution, GlaxoSmithKline
• Tom Wagner, Leader, Global Digital Governance, AstraZeneca
• Jorge Herrera, LatAm Head of Digital, Pfizer
• Sandra Velez, Content Strategy Leader, Customer Engagement COE, Merck
• John Kane, Director of Commercial Training & Leadership Development, Eisai
• Laurent Flouret, Director Digital Launch Readiness, Sanofi
• Andrew Schwartz, Director NA IT Strategy & Ops, Ipsen
• Greg Cohen, Global Associate Director, Multichannel Marketing, UCB
• Rachel Sosalski, Director, Pharmacy Marketing, GlaxoSmithKline

Download the brochure now to find out who else is on the agenda.

Use discount code 2772DC300 to save $300. Register today!

The Customer Engagement USA 2015 Summit is designed for those who:

• Want to develop global capabilities and have the vision of creating streamlined marketing processes as well as channel integration
• Appreciate marketing innovation and understand or desire to understand how data can help achieve multichannel marketing efficiency
• Believe we can do better at understanding and engaging with our customers to provide the information they need
• Are inspired to think outside the box, work across job functions and look to achieve beyond just ROI

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The content of Sponsored Posts does not necessarily reflect the views of Pembroke Consulting, Inc., Drug Channels, or any of its employees.

Three Ways The C-Suite Can Prepare for the Cadillac Tax

Today’s guest post comes from Leon Greene, Cofounder and Executive Vice President at Truveris. Leon discusses “the Cadillac tax,” a federal tax employers will pay on higher priced employee health benefit plans. The tax is scheduled to go into effect in 2018.

Leon offers three concrete actions that could lessen the effect of the Cadillac tax:

• Use available technologies to research your vendors’ economics
• Offer your employees digital tools such as OneRx to help them identify the potential cost savings of coupons or paying cash for their prescriptions
• Educate your employees on their health insurance options and promote wellness programs to workers

Read on and see if you agree.

How Wholesalers Profit from Brand-Name Drug Inflation (But Perhaps Not As Much As You Think)

Since pharmaceutical pricing is in the news, let’s take a look at how pharmaceutical wholesalers benefit from inflation in brand-name drugs.

Growing drug prices are boosting wholesalers’ top-line revenues. We estimate that in the twelve months ending June 30, 2015, U.S. drug distribution revenues at the Big Three public wholesalers—AmerisourceBergen, Cardinal Health, and McKesson—reached a record $353 billion.

And as I explain in the excerpt below from our new 2015-16 Economic Report on Pharmaceutical Wholesalers and Specialty Distributors, wholesalers also generate substantial gross profits as prices increase. Their agreements with manufacturer and negotiations with customers, however, reduce wholesalers’ ability to retain the full benefit.

P.S. Friendly reminder: Special discount pricing on our new report ends this Saturday!

How Pharmacy Benefit Deductibles Stimulate Manufacturer Copay Program Spending

With little fanfare, the IMS Institute has just snuck out an interesting report: Emergence and Impact of Pharmacy Deductibles: Implications for Patients in Commercial Health Plans. (free download) The report’s overarching theme is unsurprising: Higher out-of-pocket costs reduce patients’ adherence to drug therapy and increase prescription abandonment rates.

The report’s major contribution, however, links the growth in pharmacy deductibles to manufacturers’ copayment offset programs, which cover a beneficiary’s out-of-pocket costs for a brand-name drug. High deductible plans are shifting costs from payers to consumers and—in many cases—back to manufacturers.

And as the charts below show, pharmaceutical manufacturers end up (perhaps inadvertently) paying full-price for an increasing number of prescriptions for their own products. Ouch.

Read on and then consider whether these results affect your company’s strategy.

Real World Evidence & Market Access Summit 2015

eyeforpharma Real World Evidence & Market Access Summit 2015
December 3-4, 2015 | Philadelphia, PA
www.eyeforpharma.com/rwe/

The 4th annual eyeforpharma Real World Evidence & Market Access Summit 2015 is the meeting place 250+ industry leaders in data, HEOR and market access come together to finalize the 2016 evidence strategy.

Drug Channels readers will save $300 off the standard registration rate when they register with discount code 4318DC300.

Latest additions include:

• Geisinger Health System on specialty analytics: Hear from Eric Newman, Vice-Chair of Clinical Innovations, on how Geisinger established a specialty care delivery model through the use of data analytics
• Is there an industrial complex around evidence? Sanofi’s policy leader Joseph Devaney speaks on the risks of dependencies and reveals differences between cost containment-driven quality measures and patient and outcomes-driven quality indicators – one that matters…
• How to engineer the (r)evolution in the evidence hierarchy: Optum Lab’s Paul Wallace, Chief Medical Officer, reveals how alternative models and methods can be applied to support your evidence generation and documentation.
• GSK’s innovative strategies to making all phase III studies pragmatic: Bridge the gap between the evidence being produced by pharma and the type of information that decisions makers want with Rafael Alfonso, Director, Value Evidence Analytics
• Cedars-Sinai on medication adherence: Hear from Pharmacy Director Rita Shane how to assess high risk Medicaid populations with multiple medications
• North Shore on improving clinical outcomes: Frederick Muench, Director, Health Interventions, presents insights on developing streamlined digital assessment and intervention tools to increase engagement

These are just a few of the exciting updates taking place during the program. See all of the latest developments, download the event brochure, and gain front-line insights from AMGA, Novartis, AstraZeneca, Pfizer, Mount Sinai, J&J, Actavis and 50+ others.

Use discount code 4318DC300 to save $300. Register today!

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The content of Sponsored Posts does not necessarily reflect the views of Pembroke Consulting, Inc., Drug Channels, or any of its employees.

Employers Get Tougher About Pharmacy Benefits and Specialty Drug Management

It’s time for our annual review of the Kaiser/HRET 2015 Employer Health Benefits Survey, which you can read online for free. The survey delves into employer-sponsored health coverage at 2,000 companies.

Today, I profile the 2015 pharmacy benefit highlights from this well-executed survey. The charts below summarize (1) cost-sharing tier structures, (2), average copayments, by formulary tier, (3) type of cost-sharing (coinsurance and copayment), and (4) new data on specialty drug management strategies.

Bottom line: Employers didn’t make major changes this year, but they continue to shift prescription drug costs to beneficiaries and are focusing on specialty drug management. As I explain below, the plan details won’t give employees a glad expression.

Data-Driven Strategies for Specialty Product Optimization

Data-Driven Strategies for Specialty Product Optimization
December 9, 2015 | Philadelphia, PA
www.cbinet.com/specialtydata

CBI’s December 9th Summit on Data-Driven Strategies for Specialty Product Optimization is the first and only event for the biopharmaceutical industry that is laser-focused on strategies for leveraging third-party data to drive your specialty drug access, uptake, adherence and outcomes.

Benefit from compelling case studies, expert panels and interactive discussions:

• Discover key data insights that support product placement on formulary
• Enhance strategic contracting with key stakeholders
• Gain insight into channel partners ability and willingness to share data sets
• Address performance management and metrics management
• Assess the emergence of specialty pharmacy data within Integrated Healthcare Systems
• Utilize specialty data to enhance care coordination across the patient journey
• Apply data to maximize the impact of business decisions and activities
• Address privacy concerns and risks associated with specialty data

Visit www.cbinet.com/specialtydata for more information. Drug Channels readers will save $200 off of the standard registration rate when they use discount code QMS268.*

*Cannot be combined with other offers or used towards a current registration. Cannot be combined with special category rates. Other restrictions may apply.

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The content of Sponsored Posts does not necessarily reflect the views of Pembroke Consulting, Inc., Drug Channels, or any of its employees.

The Power of Formulary Non-Exclusion: Express Scripts Adds PCSK9 drugs

This week, pharmacy benefit manager (PBM) Express Scripts announced that both of the new PCSK9 inhibitors—Repatha (from Amgen) and Praluent (from Sanofi/Regeneron)—will be on its National Preferred Formulary. Both products will be subject to extensive prior authorization and step therapy. Read the press release.

This formulary approach contrasts sharply with the approach used for the Hepatitis C products. As I explain below, perhaps Express Scripts has learned an important lesson about the business risks of formulary exclusion. AmerisourceBergen, however, may find that it was dealt a losing hand.

As Canadian philosopher Gary Lee Weinrib once opined: "If you choose not to decide, you still have made a choice." Read on and see if you agree.

NEW: 2015-16 Economic Report on Pharmaceutical Wholesalers and Specialty Distributors

I am pleased to announce the availability of our new report: the 2015-16 Economic Report on Pharmaceutical Wholesalers and Specialty Distributors. We’re offering special discounts if you order before October 24, 2015.

This year’s report—our sixth edition—has been updated, revised, reorganized, and expanded. It contains the latest industry and financial data, along with detailed information about the strategies and market positions of the largest public companies: AmerisourceBergen, McKesson, and Cardinal Health. It also includes many new elements.

• Click here to download a free report overview

• Click here to review the Table of Contents.

• Click here to review the List of Exhibits

The 2015-16 Economic Report on Pharmaceutical Wholesalers and Specialty Distributors is the most comprehensive, non-partisan tool for building deep business acumen about the economic and business realities of U.S. pharmaceutical distribution.

I've worked hard to make it an essential tool for pharmaceutical manufacturers, wholesalers, pharmacists, pharmacy owners, benefit managers, managed care executives, healthcare policy analysts, investors, consultants—anyone who wants to understand and benefit from this ever-changing industry.

Alas, the report has no corny jokes and 0.0% pop culture references. I recognize that some Drug Channels readers may consider these omissions to be value-enhancing features.

If you have any questions (before or after reading the report), please email me. Enjoy!

Life Sciences Trade and Channel Strategies 2015

CBI’s 11th Life Sciences Trade and Channel Strategies
December 9-10, 2015 | Philadelphia, PA

Are you ready for some drug channel strategy?

Then join me at CBI’s 11th Trade and Channel Strategies conference, being held this December in Philadelphia. CBI’s annual event is the life science industry’s premier event focused on bio/pharma trade, channel, and account management. Use discount code AKE367 to save $200.

Adam J. Fein, Ph.D., of Pembroke Consulting, will kick things off with a keynote address called Drug Channels Update—Things to Watch in 2016. Dr. Fein will update everyone on hot topics and identify key strategic issues for the year ahead.

Day one will end with the renowned Trade Throwdown: Battle of the Experts. This year, Dr. Fein will be joined by Bill Roth of Blue Fin Group and Allen Dunehew of Rx Sourcing Strategies. Come prepared with your most vexing questions and watch them compete in CBI’s XTreme Trade Battle Cage™. Three consultants will enter…but only three will leave!

Other new features for 2015 include:

• A Trailblazer Address from Kaiser Permanente Colorado on Optimizing Care and Quality in Our Health System.
• A Manufacturer Strategic Viewpoint Panel featuring industry speakers discussing network design and forward-thinking product-specific strategies for optimized distribution.
• A Wall Street Panel, where you'll learn how the drug channel is changing and what they are forecasting for the future.
• A Trade Think Tank, where you can identify trailblazing trends by benchmarking with your peers utilizing interactive and anonymous live polling.

Visit www.cbinet.com/trade for more information. Drug Channels readers will save $200 off of the standard registration rate when they use code AKE367.*

*Cannot be combined with other offers or used towards a current registration. Cannot be combined with special category rates. Other restrictions may apply.

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The content of Sponsored Posts does not necessarily reflect the views of Pembroke Consulting, Inc., Drug Channels, or any of its employees.

EXCLUSIVE: In 2016, 85% of Medicare Part D plans have a preferred pharmacy network

The Centers for Medicaid & Medicare Services (CMS) just released data on 2016's Medicare Part D plans. Our exclusive, warp speed analysis reveals that 85% of Medicare Part D regional prescription drug plans (PDP) will have a preferred cost sharing network in 2016. That’s comparable to the 2015 figures, and signals that these plans are here to stay.

Preferred network plans are controversial (and generally disliked) by pharmacy owners. That’s because reduced pharmacy profits are the biggest source of cost savings from these networks. Despite ongoing complaints, it's still full speed ahead for preferred networks.

Read on for a look at the top plans. I'll review pharmacy network participation in a future article.

It's Finally Time For ICD-10 Fun!

Rejoice, fans of medical billing codes. It’s ICD-10 Compliance Day!

As you may know, the International Classification of Diseases (ICD) will expand the number of medical service codes for doctors and hospitals, from 18,000 in the ICD-9 to more than 140,000 in the ICD-10. Click here for a good background article from The Wall Street Journal. The Centers for Medicare & Medicaid Services (CMS) has been counting down to today's launch.

So, today is a perfect time to revisit the Find-A-Code YouTube channel, where you can see a gaggle of semi-wacky video clips illustrating legitimate ICD-10 codes.

I picked out a few choice ones below, including my personal favorite V95.44 ("Spacecraft accident injuring occupant”). And that's only one of an astounding 21 spacecraft-related ICD-10 codes.

Click here to search the database and discover your own lucky code.

Drug Channels News Roundup, September 2015: CVS Health, AmerisourceBergen, and Generic Inflation

Fall is here! Curl up with your extra hot grande Pumpkin Spice Whatever and check out this cornucopia of stories harvested from the Drug Channels crop:

• A neat profile of Helena Foulkes, president of CVS/pharmacy (and future CEO of CVS Health?)

• An interesting interview with AmerisourceBergen CEO Steve Collis

• The other NCPA deconstructs the supply chain factors behind generic drug inflation

Plus, The Onion reports on a highly innovative new health benefit plan.

P.S. For my daily harvest of interesting news stories, follow @DrugChannels on Twitter.

Real World Evidence & Market Access Summit 2015

eyeforpharma Real World Evidence & Market Access Summit 2015
December 3-4, 2015 | Philadelphia, PA
www.eyeforpharma.com/rwe/

The 4th annual eyeforpharma Real World Evidence & Market Access Summit 2015 provides attendees with 5 strategic events in one, offering a rare 360° view on how big data becomes evidence, and evidence becomes value. For the first time, 15+ major health systems and key payers signed up to talk specifics from data sharing, formulary design to risk-based contracting. Of course, the program will still include government contributions and exclusive pharma industry case studies. That promises a fascinating bundle of unfiltered information from the entire suite of data and market access stakeholders – all under one roof.

Drug Channels readers will save $300 off the standard registration rate when they register with discount code 4318DC300

Speakers Include:

• Usman Iqbal, Senior Director, Medical Affairs Leader, AstraZeneca
• Eugene Kolker, Chief Data Officer, Seattle Children’s Hospital
• Mark Weiner, Chief Medical Information Officer, Temple University Health System
• John Hernandez, Global VP, HEOR, Abbott
• Marilyn Metcalf, Sr. Director, Benefit Risk Evaluation, GlaxoSmithKline
• Faisal Mehmud, VP Medical Affairs, Novartis
• Garrett Ingram, VP & Head, US Market Access, Sanofi
• Julie Locklear, VP, HEOR, EMD Serono
• Eric Newman, Vice-Chair of Clinical Innovations, Chief of Specialty Care Innovation & Integration, Geisinger

Download the brochure now to find out who else is on the agenda!

Use discount code 4318DC300 to save $300. Register today!

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The content of Sponsored Posts does not necessarily reflect the views of Pembroke Consulting, Inc., Drug Channels, or any of its employees.

Why Walgreens Boots Alliance is Triggering a Huge AmerisourceBergen Stock Buyback

On Tuesday, AmerisourceBergen announced a new $2.4 billion share repurchase program. Read the press release. This new program brings ABC’s total repurchases to more than $4 billion in less than two years.

Here's why: ABC’s multi-faceted deal with Walgreen Boots Alliance (WBA) is motivating these transactions.

Let’s peer over the hedge and find out what’s going on.

New Cardinal and McKesson Customer Deals Show A Changing Generic Channel

In July, I highlighted how payer and pharmacy consolidation will affect drug wholesalers. As I detail below, two big acquirers—OptumRx and Albertsons—are both switching primary wholesalers and simultaneously migrating their generic purchasing to the wholesale channel.

These latest deals show how generic purchasing consortia are accelerating business alignment between pharmacies and their wholesaler suppliers.

The deals also signal further generic purchasing consolidation. For both brand-name and generic drug manufacturers, a robust channel strategy function is more important than ever.

VA DoD PHS Federal Pricing and Contracts

CBI’s VA DoD PHS Federal Pricing and Contracts
November 18-19, 2015 | Philadelphia, PA
www.cbinet.com/vadod

Now in the seventh year, CBI's VA DoD PHS Federal Pricing and Contracts Forum elevates the conversation and dives deep into the complexity of contracting with the "Big Four" federal programs. This meeting offers bio/pharma manufacturers best practices and timely updates from government officials and industry counterparts on pricing models and processes for complying with complicated rules and regulations. Download the complete agenda here.

BREAKING NEWS! As of August 27th, HRSA has released its proposed “Mega/Omnibus” Guidance, which addresses longstanding questions around manufacturer and covered entity participation in the 340B program. This conference is poised to deliver insight into key program changes and regulatory updates within the rapidly evolving 340B program. Benefit from sessions dissecting the guidance, benchmark with peers on operational challenges, and participate in an interactive discussion during the 340B focus group luncheon.

Visit www.cbinet.com/vadod for more information. Drug Channels readers will save $200 off of the standard registration rate when they use code UAP764.*

*Cannot be combined with other offers or used towards a current registration. Cannot be combined with special category rates. Other restrictions may apply.

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The content of Sponsored Posts does not necessarily reflect the views of Pembroke Consulting, Inc., Drug Channels, or any of its employees.

Here’s Who Will Pay For Prescription Drugs in 2024

In New CMS Forecast: Drug Spending Grows Along with Impossible Hospital and Doctor Spending, I examined the July 2015 drug spending forecasts from the Centers for Medicare and Medicaid Services (CMS).

Today, I identify new insights about payments in the 2024 drug market. As the charts below show:

• CMS expects the employer-sponsored insurance market to be slightly more resilient than it had previously projected.

• By 2018, however, Medicare, Medicaid, and other public programs will pay more than employers for drugs.

• CMS still projects that individually-purchased private insurance (via exchanges) will account for a small share of drug spending.

As the government’s role grows, don’t tell me you were fooled (again).

Customer Engagement Summit 2015

eyeforpharma Customer Engagement USA Summit 2015
November 19-20, 2015 | Philadelphia, PA
www.eyeforpharma.com/customer-engagement/

At eyeforpharma’s 3rd annual Customer Engagement Summit, attendees will learn how to engage their key customers through a wide range of channels - from digital to F2F. The speaker faculty selected from both inside and outside the industry will focus on truly intelligent engagement strategies that start with the customer and end with the channel.

Drug Channels readers will save $300 off the standard registration rate when they register with discount code 2772DC300.

Speakers include:

• Jim De Lash, Director Multi-Channel Marketing Execution, GlaxoSmithKline
• Tom Wagner, Leader, Global Digital Governance, AstraZeneca
• Jorge Herrera, LatAm Head of Digital, Pfizer
• Sandra Velez, Content Strategy Leader, Customer Engagement COE, Merck
• John Kane, Director of Commercial Training & Leadership Development, Eisai
• Laurent Flouret, Director Digital Launch Readiness, Sanofi
• Andrew Schwartz, Director NA IT Strategy & Ops, Ipsen
• Greg Cohen, Global Associate Director, Multichannel Marketing, UCB
• Rachel Sosalski, Director, Pharmacy Marketing, GlaxoSmithKline

Download the brochure now to find out who else is on the agenda.

Use discount code 2772DC300 to save $300. Register today!

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The content of Sponsored Posts does not necessarily reflect the views of Pembroke Consulting, Inc., Drug Channels, or any of its employees.

A Roundup of 340B Omnibus Guidance Analyses

In Manufacturers: The Government Wants to Use 340B to Oversee and Publish Your Specialty Channel Strategy, I highlight one area of significant concern in the Omnibus Guidance for the 340B Drug Pricing Program from the Health Resources and Services Administration (HRSA).

To provide perspective on other elements, below I provide links to more comprehensive reviews from four major law firms. Each provides a different spin on key topics in the proposed guidance—patient definition, duplicate discounts, covered entity requirements, contract pharmacy oversight, manufacturer responsibilities, and more.

Hope these analyses temporarily satiate your 340B desires.

Manufacturers: The Government Wants to Use 340B to Oversee and Publish Your Specialty Channel Strategy

Attention, proles! The Health Resources and Services Administration (HRSA) has released its long-awaited Omnibus Guidance for the 340B Drug Pricing Program.

The guidance brings some much-needed clarity to the definition of an eligible patient. Its focus on duplicate discounts and diversion is welcome, as is the requirement that covered entities audit and monitor contract pharmacies.

Unfortunately, HRSA has granted itself intrusive oversight for what it calls “limited distribution plans.” Under the guise of auditing manufacturer compliance, HRSA is asserting novel and impractical review and approval authority over manufacturers' channel strategies.

And as I describe below, every manufacturer is expected to have its channel strategies reviewed and then published by the U.S. Department of Health and Human Services (HHS). Watch out!

CBI’s Final Rule Forum

CBI’s Final Rule Forum
November 20, 2015 | Philadelphia, PA

Attention, AMP fans! CMS’ long-awaited Final Rule on Covered Outpatient Drugs is officially under final review at the OMB, with an anticipated completion date of October 2015. Mark your calendar for November 20, 2015 and plan to attend CBI’s Final Rule Forum. Here, bio/pharma manufacturers will gain exclusive insight into policy changes and best practices to put learnings into action within their organizations.

Practical Approaches and Positions on:

• Rule dissection, top ten high impact areas and considerations for implementation
• Next steps for changes to the wholesaler ‘build-up’ provision
• Definition of RCPs and impact on 5i products/methodology
• Impact of changes on class or trade and AMP calculations
• Considerations and best practices for system changes/updates
• Bona fide service fees, fair market valuations, and bundling
• Documentation and contracting process changes
• Calculation and implementation of line extensions

PLUS! There will be an exclusive Manufacturer Town Hall led by Biogen, Bristol-Myers Squibb, Celgene, Chiesi USA, Purdue, Sandoz and West-Ward Pharmaceuticals.

Visit www.cbinet.com/finelrule for more information. Drug Channels readers will save $300 off of the standard registration rate when they use code CAP779.*

*Cannot be combined with other offers or used towards a current registration. Cannot be combined with special category rates. Other restrictions may apply.

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The content of Sponsored Posts does not necessarily reflect the views of Pembroke Consulting, Inc., Drug Channels, or any of its employees.

Two Important Updates on #Zarxio and Biosimilar Reimbursement (rerun)

This week, I’m rerunning some popular 2015 posts. Click here to see the original post and comments from February 2015

Today’s rerun is especially timely. Yesterday, Zarxio launched at a reported 15% discount to Amgen’s Neupogen, the innovator reference product.

Since my original article, CMS has proposed that multiple biosimilars for the same reference product be grouped into the same J-code. See Payment for Biosimilar Biological Products Under Section 1847A in its July 2015 proposed rule (CMS-1631-P). However, my general math below still applies.

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In Zarxio: How Channel Dynamics Will Limit the First U.S. Biosimilar, I argue that reimbursement and channel dynamics will slow adoption for Zarxio. Zarxio, a provider-administered specialty drug, is a non-interchangeable biosimilar of Amgen’s Neupogen.

Today, let’s catch up on two important items regarding reimbursement for biosimilars:

• In my original article, I didn’t mention the Affordable Care Act’s special reimbursement formula, which provides additional reimbursement for the biosimilar. Below, I explain this methodology and provide a mathematical example using Neupogen and Zarxio.

• Last week, the Centers for Medicare & Medicaid Services (CMS) released a brief Q&A with new details on biosimilars. Highlights below.

Taken together, this information still supports my original conjectures about a moderate pace for adoption for biosimilars paid under the medical benefit—and implies some manufacturer pricing strategies that could influence adoption.

CMS to Part D Preferred Pharmacy Networks: We’ll Be Watching You (rerun)

This week, I’m rerunning some popular 2015 posts, so I can work on the forthcoming 2015-16 Economic Report on Pharmaceutical Wholesalers and Specialty Distributors.

Click here to see the original post and comments from February 2015. Today's rerun, along with What’s Behind Walmart’s Pharmacy Profit Warning?, will help you get anticipate the 2016 Part D marketplace.

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This past Friday, the Centers for Medicaid & Medicare Services (CMS) released its thoroughly-titled Advance Notice of Methodological Changes for Calendar Year (CY) 2016 for Medicare Advantage (MA) Capitation Rates, Part C and Part D Payment Policies and 2016 Call Letter. Most people refer to this 172-page ode to healthcare bureaucracy as the 2016 Call Letter.

CMS’s proposed changes to Part D’s pharmacy networks will not sting as much as they did last year. In the Call Letter, CMS outlines its concerns about preferred cost-sharing pharmacy networks and proposes policing them more closely. Read my analysis below.

If you want to comment, you have every single day until March 6, 2015.

Which PBM Best Managed Drug Trend in 2014: CVS Health, Catamaran, or Express Scripts? (rerun)

This week, I’m rerunning some popular 2015 posts, so I can work on the forthcoming 2015-16 Economic Report on Pharmaceutical Wholesalers and Specialty Distributors.

Click here to see the original post and comments from May 2015.

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Three of the biggest pharmacy benefit managers (PBMs)—Catamaran, CVS Health, and Express Scripts—have now released their 2014 drug trend reports. (Links below.) That means it’s time for my annual review of what the reports say about drug spending—and which questions remain unanswered.

Drug trend measures the change in a plan sponsor’s total prescription drug expenditures—excluding rebates and (sometimes) administrative fees.

Express Scripts and CVS Health reported comparable drug trend figures, while Catamaran’s were much lower. Oddly, Prime Therapeutics issued a spending report that omitted drug trend figures. When it publishes a more complete analysis, I’ll publish an update.

As I noted last year, the top-line figures don’t tell the full story, due to differences in methodology and data presentation differences. When you read a PBM’s drug trend report, don’t forget Mark Twain’s observation: Confidence is the feeling you have before you fully understand the situation.