Building a Strong Pharma Sales Approach in the New ACO Marketplace

Today’s guest post comes from two physician-leaders of major accountable care organizations (ACOs):

• Anthony Slonim, MD, DrPH, CPE, FACPE; President and CEO of Renown Health, Reno, NV; Chair, CMR Institute’s Board of Directors

• Jeffrey Farber, MD, MBA, CPE, FACP; CEO, Mount Sinai Care (ACO); Chief Medical Officer, Mount Sinai Health Partners (MSO), New York, NY

Drs. Slonim and Farber are thought leaders on strategic ways value-based care health systems can collaborate with industry partners to improve and shape the future of healthcare. They are also conference chairs and speakers at the upcoming ACOs and Industry: A Collaboration for Value Conference on March 26-27 in Minneapolis, MN.

Check out this thought-provoking article. There is also an interesting video of Dr. Farber embedded below.

News Roundup, February 2014: CVS Health, Walgreens Boots Alliance, Celgene, 340B, and more

Brrrr! This year’s ultra-cold winter is not done yet. (I blame Elsa.) To stay warm, please enjoy this month's look at noteworthy new stories from the Drug Channels universe. In this issue:

• CVS Health prepares you for the next specialty drug war

• Stefano Pessina shares his business philosophy and vision for Walgreens Boots Alliance

• Celgene releases a useful letter on 340B and limited dispensing networks

Plus: A long time ago in a culture that seems far, far away, vaccinations weren't viewed as a government plot to give kids autism. Watch the video below for proof.

P.S. Follow @Drug Channels for my daily updates on noteworthy news and interesting analysis.

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

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.

Join me at 2015 Armada Specialty Pharmacy Summit

Please join me at 2015 Armada Specialty Pharmacy Summit, which will take place on May 4-8, 2015, at the wonderful Wynn Las Vegas.

Based on personal experience, I can tell you that the Summit attracts an impressive diversity of pharmacies, manufacturers, health plans, wholesalers, hospital systems, pharmacy benefit managers, patient advocacy groups, and others. This year's program has solid business and educational programming. View the Agenda.

Below, watch a fun video review of 2014’s Summit. I can be heard (but not seen) twice. Yes, that’s me at 00.44 extolling the value of “cocktails and conversation.” J You can read my business review of the 2014 summit in Seven Trends For Specialty Pharmacy’s Future: Reflections on Armada 2014.

Read on for more details about this great specialty pharmacy event, or just register now. See you there!

Why Are Generic Drugs Getting More Expensive?

Today’s guest post comes from Kay Morgan, Vice President of Drug Products & Industry Standards Clinical Solutions at Elsevier.

Kay discusses the factors behind recent generic inflation and argues for the value of timely drug pricing data. As you may know, Elsevier’s Gold Standard Drug Database includes a wealth of drug pricing data, including such favorites as AWP, NADAC, and state MACs. Elsevier also provides Predictive Acquisition Cost (PAC), a novel acquisition-based drug price solution.

In addition to the article below, I suggest you check out Generic Drug Price Increases: Causes and Impact, Elsevier’s new white paper on this important trend.

New Details on CVS Health’s Specialty Connect Program

Last week’s surprising Rite Aid/EnvisionRx deal illustrates the convergence of benefit management with dispensing channels.

Based on new disclosures during CVS Health’s most recent quarterly earning call last week, Specialty Connect—the company's latest convergence offering—appears to be getting more traction. Below, I highlight how Specialty Connect alters the business economics of CVS Health’s pharmacy business.

Like Maintenance Choice, Specialty Connect challenges competing pharmacies and pharmacy benefit managers (PBMs), which can’t easily imitate this offering. Expect payers to continue adopting it—but also expect competitors to find 38 special reasons to complain.

ACOs and Industry: A Collaboration for Value Conference

ACOs and Industry: A Collaboration for Value Conference
March 26-27, 2015 | Minneapolis, MN

Need straight-talk DIRECTLY from Accountable Care Organization (ACO) execs? The healthcare marketplace is changing, and it’s impacting the way you do business. To adapt quickly and succeed, you need insight and understanding DIRECTLY from healthcare leaders on the frontline of these changes.

Please join CMR Institute for its 3rd annual ACOs and Industry: A Collaboration for Value Conference on March 26-27 in Minneapolis, MN. Here, you will have a unique opportunity to learn from and network with CEOs and other high-level execs from 10 ACOs nationwide including:

• Allina Health (MN)
• Renown Health (NV)
• Mount Sinai Care (NY)
• Fairview Pharmacy Service (MN)
• HealthPartners (MN)
• North Memorial (MN)
• Keystone (NJ)
• Martin Health System (FL)
• Geisinger (NJ)
• Carilion Clinic (VA)

Don’t miss this unique opportunity to strengthen your ACO alliances and learn how to:

• Transform sales, marketing, and training strategies
• Align your products to the value-based care model
• Generate solutions alongside ACO executives
• Learn about outcomes-based contracting
• Understand the disease-specific products, tools, programs, and services ACOs need

CMR Institute is offering Drug Channels readers an exclusive $200 discount. Use code DRUG200 at registration.

Register and learn more at http://www.acocollaboration.org

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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.

Rite Aid-EnvisionRx: Initial Thoughts on the Deal

This morning, Rite Aid announced the surprise acquisition of privately-held pharmacy benefit manager (PBM) EnvisionRx. Read the press release.

With this transformative deal, Rite Aid is now explicitly building a mini-CVS Health. That’s not necessarily a bad thing.

Below, I highlight a few interesting tidbits about EnvisionRx, offer some initial thoughts on the transaction, and provide some preliminary prognostications. Based on what I've heard so far, this deal looks to be a big win for Rite Aid.

Question to ponder: Will this deal trigger a new partnership between Express Scripts and Walgreens Boots Alliance?

Why Blockbuster Hepatitis C Drugs Are Squeezing McKesson’s Profits

Last week, McKesson reported big revenue gains for its distribution business segment—increases that have been driven partly by booming sales of new hepatitis C drugs. Read the press release.

However, McKesson’s disclosures suggest that the company barely broke even—and may have even lost money—by selling such drugs as Gilead Science’s Sovaldi and Johnson & Johnson’s Olysio.

Three key factors—outlined below—are driving this profit squeeze. More broadly, the hepatitis C situation highlights wholesalers’ growing risks for pharmacy-dispensed specialty drugs.

Read on and see if you agree with my slap and tickle math.

GPO Membership Eligibility and Class of Trade Maintenance

GPO Membership Eligibility and Class of Trade Maintenance
March 30-31, 2015 – Philadelphia, PA
www.cbinet.com/gpocot

CBI’s GPO Membership Eligibility and Class of Trade Maintenance conference allows you to join key stakeholders focused on providing best practices to mitigate membership compliance risk, ensure accuracy in Class of Trade designations, and streamline data processes.

Join us in March and gain insight on pressing issues from experts representing Amerinet, Arbor Pharmaceuticals, Cardinal Health Specialty Solutions, Chiesi USA Inc., Covance Market Access Services Inc., Essential Healthcare Management, Henry Schein, McKesson Corp, Pfizer Inc., Porzio Bromberg & Newman PC and more!

Key Reasons to Attend:

• Explore the impact of membership challenges on chargeback errors and discrepancies
• Develop strategies to standardize and automate membership validation procedures
• Enhance the accuracy and integrity of inbound membership data
• Optimize PHS membership management to streamline 340B
• Evaluate where manufacturer and GPO forms of verification coincide
• Gain insight into how various stakeholders define membership and determine COT

CBI is offering Drug Channels readers an exclusive $300 discount when you register by Friday, March 27th. Mention promo code GPO430.

*Offer valid through March 27, 2015, applies to standard rates only and may not be combined with other offers, category rates, promotions or applied to a current registration.

The Moment of Truth: Why Do Consumers Make the Decisions They Do?

Today’s timely guest post comes from Pamela Morris, Director, Syndicated Research, Zitter Health Insights.

She shares survey data from Hepatitis C and Diabetes patients. The data were gathered immediately after the patients visited their doctor, and include such information as the patients’ own disease research, conversations with their doctors, and intentions regarding treatment.

As Pamela explains, higher deductibles force patients to make tough healthcare choices. What motivates these choices, and how can one capture that information?

The answers can be found in the patient data available from Consumer Connect, Zitter Health Insight’s subscription service. To learn more about Consumer Connect, visit the Zitter Health Insights website or email Michala Jeberg.

What Gilead’s Big Hepatitis C Discounts Mean for Biosimilar Pricing

This week, Gilead Sciences reported blockbuster 2014 results for its hepatitis C products Sovaldi and Harvoni. Read the press release. However, Wall Street freaked out when Gilead disclosed that its payer discounts are much larger than many people had assumed—more than 50% off list in some cases. (See the numbers below).

These unexpectedly large price cuts provide more evidence that competition gives payers enormous power, even when purchasing differentiated, highly valuable therapies. Imagine what will happen as biosimilar versions of top-selling biological drugs hit the market over the next few years.

Sorry to be the bearer of bad news. But for the manufacturers developing biosimilars and those defending biological products, it’s probably time to lower revenue projections.

The Specialty Pharmacy Boom Continues

For 2014, we estimate that retail, mail, and specialty pharmacies dispensed about $78 billion in specialty pharmaceuticals.

How many pharmacies dispensed these drugs? Surprisingly, we still can’t definitively answer this question, as I explain below. To measure specialty pharmacy growth, I worked with a renowned mathematician (pictured at right) to crunch data from URAC, an independent accreditation company.

As the chart below shows, the number of accredited specialty pharmacies is still booming. As of late December 2014, 89 companies with 151 specialty pharmacy locations had achieved “Full Accreditation.” An additional 99 companies are “In Process” and are likely to be accredited in 2015.

11th Life Sciences Accounting & Reporting Congress

11th Life Sciences Accounting & Reporting Congress
March 16-18 | Philadelphia, PA
www.cbinet.com/accounting

The world’s largest and longest running event for finance and accounting professionals in the life sciences industry is ramping up for the most in-depth and impactful event yet. The Accounting & Reporting Congress is the life science community’s gold standard conference for finance, accounting and reporting professionals, offering industry-specific CPE content.

As the industry undergoes rapid and systemic evolution (due to healthcare reform, M&A, pricing mandates, wholesaler/pharmacy channel evolution, weakened IP, global expansion, R&D imperatives, cost containment initiatives and increased regulatory scrutiny), CFOs, Controllers and Senior Accounting/Finance professionals are the corporate stewards for new business and growth opportunities. This event presents new revenue models and minimizes risk. Visit www.cbinet.com/accounting for more information.

Drug Channels readers will save $200 off of the standard registration rate when they use code KMP386.*

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