Drug Channels News Roundup, May 2017: Express Scripts, WBAD, DIR Fees, JAMA, and #Asembia17 Photos

Summer is unofficially here! Before you break out the grill, check out these officially noteworthy items:

• My $0.02 on the new Express Scripts-Walgreens alliance

• CMS wants more details on pharmacy-paid DIR fees

• JAMA discovers the drug channel

Plus, revisit Asembia’s 2017 Specialty Pharmacy Summit with an awesome photo gallery. You’ll find two of my favorites lurking below.

P.S. My @DrugChannels twitter feed now has an astounding 4,100 followers. Join them and see why!

CBI’s Summit on GPO Membership Eligibility and Class of Trade Maintenance

GPO Membership Eligibility and Class of Trade Maintenance
June 20-21 2017 | Parsippany, NJ
www.cbinet.com/GPOCOT

CBI’s Summit on GPO Membership Eligibility and Class of Trade Maintenance is coming up this June 20-21 at the Hilton in Parsippany, NJ. This event convenes over 100 industry professionals representing manufacturers, GPOs, wholesalers, distributors and solution providers and arms attendees with strategies to overcome the significant operational challenges related to the proper management of customer data and GPO membership data.

Interactive Discussions and Actionable Takeaways on Topics Including:

• Strategic Contracts in the Evolving Healthcare Delivery Landscape
• Class of Trade Protocol Development Strategies
• Experiences and Insights to Overcome Challenges of Membership and Class of Trade
• Wholesaler Insight on Contract Administration Processes and Best Practices
• Downstream Effects of Class of Trade Implications
• Partnership Pavilion with Insight on Propelling Collaboration for Streamlined Communication
• Plus! Benefit from 4-Focused Working Groups with attendees from CBI’s Contracts and Chargebacks conference

Multistakeholder Perspectives and Innovative Insights From:

Alliance Life Sciences • Amneal Pharmaceuticals • Arent Fox LLP • AstraZeneca • Carolinas HealthCare System • Cardinal Health • Chiesi USA Inc • Deloitte & Touche LLP • McKesson • Prometic BioTherapeutics, Inc. • Shire • Zydus Pharmaceuticals • And More!

For more information, please download the complete agenda or visit www.cbinet.com/GPOCOT. Drug Channels readers will save $200 off of the standard registration rate when they use discount code JSK589.*

*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.

A Reality Check on Amazon’s Pharmacy Ambitions

CNBC reported last week that Amazon may enter the pharmacy and/or pharmacy benefit manager (PBM) market. Here’s the story: Amazon is hiring people to break into the multibillion-dollar pharmacy market.

The news made many people freak out and then begin speculating on all of the amazing ways that Amazon would change the drug channel. USA Today breathlessly mused: Could your next prescription come from Amazon?

Amazon has been successfully attacking the front-end business of chain drugstores. But could it really disrupt the pharmacy and PBM industries?

Below, I provide a reality check on how Amazon could compete—and what it is unlikely to do.

Join me at the World Congress Pharma4 Event

World Congress Pharma4
July 24-25, 2017 | Philadelphia

Please join me at the World Congress Pharma4 event on July 24 and 25 in Philadelphia. I am pleased to be the keynote speaker for this innovative event that brings together multiple stakeholders across the channel. I'll be talking about Winning Strategies for an Integrated Drug Channel.

This 4-track event includes four interrelated conferences:

• 4th Annual Specialty Network Design Summit

• 4th Annual Patient Support Services and HUB Design Summit

• End-to-End Supply Chain Summit

• Patient Services Compliance Summit

Register with discount code DC300 for special savings!

Registration to one of the four events grants you access to all of the sessions from any Summit part of Pharma4 - giving you the freedom to customize your experience!

Through high-level discussion:

• Discover new ways to address traditional and emerging patient needs through network design and channel partners
• Explore IT infrastructure to mitigate risk in data sharing and HUB design
• Understand how to drive visibility through the Implementation of a serialization model and strategy for visibility to ensure regulatory compliance and traceability in the chain
• Engage in facilitated discussions around contracting from value-based to specialty pharmacy and FMV pricing

Confirmed speakers include executives from Shire, Blue Cross Blue Shield, Pfizer, J&J, GSK, Novartis, Walgreen, Endo Pharmaceuticals, Vanderbilt University Medical Center, and Gateway Health Plan.

Click here to learn more and register for this event. Rates start at $995 for pharmaceutical manufacturers. Use discount code DC300 and save!

Please enjoy this conference introduction from Ray Tancredi of Walgreens.

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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.

340B Purchases Were More Than Half of the Hospital Market in 2016

Yesterday’s article on the astounding size and growth of the 340B Drug Pricing Program generated a lot of controversy. ICYMI: The 340B Program Hits $16.2 Billion in 2016; Now 5% of U.S. Drug Market

Today, I provide some context by showing how the program has taken over the hospital market.

Most 340B purchases are made by hospitals. My exclusive number-crunching below reveals that hospitals now receive discounted 340B pricing on more than 50% of their drug purchases.

Curiously, the value of hospitals' uncompensated care has been declining while 340B purchases have been soaring.

Enjoy!

EXCLUSIVE: The 340B Program Hits $16.2 Billion in 2016; Now 5% of U.S. Drug Market

The 340B Drug Pricing Program’s explosive growth continues.

Our exclusive sleuthing reveals that discounted sales hit $16.2 billion in 2016. That’s a 34% increase over the 2015 figure. Consequently, the 340B program accounted for 5.0% of the total U.S. drug market in 2016.

Covered entities are generating billions in untraceable profits from this fast-growing program. Hospitals, which make up the vast majority of 340B purchases, should be required to account clearly for the billions the program provides them.

This growth should make everyone—especially the manufacturers providing the discounts—pay much closer attention to what’s going on.

Five Fun Facts About the New Express Scripts-GoodRx Drug Discount Partnership

Last week, the pharmacy benefit manager (PBM) Express Scripts and the online discount card company GoodRx partnered on a new program called Inside Rx. The program provides point-of-sales discounts to uninsured patients on at least 40 brand-name drugs from eight manufacturers. Click here to read the press release.

This innovative partnership is the latest attempt to offer direct-to-consumer discounts that pop the gross-to-net bubble—at least for uninsured patients. Below, I delve deep inside Inside Rx. I explain:

• How uninsured patients benefit
• What’s in it for manufacturers, Express Scripts, and GoodRx
• Which pharmacies are in the program’s narrow network
• The surprises on the drug list
• How inside Rx compares with CVS Health’s Reduced Rx program

Depending on your position in the drug channel, you will feel either joy, sadness, fear, disgust, or anger as this new program rolls out. Please feel free to emote in the comments below.

Medicaid Drug Rebate Program (MDRP) Summit 2017

Medicaid Drug Rebate Program (MDRP) Summit 2017
September 11-13, 2017 | Marriott Magnificent Mile | Chicago

Government rules and regulations affect every department at a pharmaceutical company. However, few areas are as directly-and as frequently-affected as the government programs, pricing, and reimbursement space.

Due to last year’s highly anticipated release of the AMP Final Rule, 340B Mega Guidance and Proposed Rule, HRSA's Rule on Dispute Resolution, and the recent release of CMS' Proposed Medicaid Managed Care Regulation, your day-to-day operations have fundamentally changed.

Join KNect365 in Chicago this September 11-13 at MDRP Summit 2017 the essential event positioned to provide insights into the implications of these inevitable changes. It’s the longest running and the largest MDRP event where 600+ industry, state, and federal government professionals come to get questions answered, gain clarity, and remain compliant.

Download the Agenda Here for Full Session and Speaker Details.

Ensure you have the most comprehensive educational experience over three days with unparalleled access to government officials creating regulatory rules, the industry leaders interpreting them, and the pharmaceutical executives implementing them.

Register Now to SAVE an Additional $100 off the Current Rate!

Use Discount Code P2258DRUG

Collaborate with your peers and benchmark best industry practices to:

• Navigate Regulatory Hurdles
• Understand and comply with state processes, operations and requirements
• Address the impact of AMP Final Rule, 340B Guidance, along with State Policy changes

• Minimize Wasted Resources
• Develop strategies to streamline pricing and reporting
• New Interactive Think Tank & Innovation Theatre - Hear from the industry's leading service providers as they showcase new technologies and products to improve operations

• Optimize Finances
• Calculate liability and improve accuracy and accountability
• Discover the latest in Automation & Customization of finance systems

• EXCLUSIVE! Meet Face to Face with 14+ States in One-on-One Dispute Resolution Meetings where you can recoup or save millions of dollars in rebates and reimbursements.

Stay ahead of the curve by getting the best networking, education, and technology at MDRP Summit this September. There is no other MDRP event built like it.

Click Here to Register Now

(and SAVE $100 off the current rates).

Be sure to use Discount Code: P2258DRUG

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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 Misconceptions about Channel Strategy

Today’s guest post comes from AmerisourceBergen executives Donna Gilbert, Vice President Specialty and Branded Strategic Accounts, Global Sourcing and Manufacturer Relations, and Akin Odutola, Senior Vice President, Specialty and Branded Product Access, Global Sourcing and Manufacturing Relations.

Donna and Akin discuss how a manufacturer’s channel strategies affect product access and commercial success. Click here to download Changing Channels, a complimentary ebook from AmerisourceBergen.

Read on for their insights.

What I Told HHS Secretary Tom Price About the 340B Drug Pricing Program

Last Friday, I had the privilege of meeting with Secretary of Health and Human Services (HHS) Tom Price. I was invited to meet with Secretary Price for one of his listening sessions with industry experts and stakeholders. I appreciated the opportunity to share my perspectives.

In our meeting, I highlighted four ways that the 340B Drug Pricing Program is raising drug costs. I then offered eight specific recommendations for improving the program by addressing the widespread channel distortions the program has caused.

Read on for the recommendations and a summary of my comments to Dr. Price.

I have no idea if my suggestions will have any impact. Regardless, your friendly neighborhood blogger enjoyed spending time among some Washington insiders.

The State of Specialty Pharmacy 2017: Reflections from #Asembia17

Last week, Paula and I had the pleasure of attending Asembia’s 2017 Specialty Pharmacy Summit in Las Vegas, itself the summit of spectacle. We even met a new friend, as you can see from the photo on the right.

The Specialty Pharmacy Summit remains the most important forum for conducting business in the specialty marketplace. More than 5,000 people learned, networked, and connected at the wonderful Wynn Las Vegas. Thanks to Larry and Robert Irene for creating an annual event that brings the entire industry together. Click here to enjoy the social media action from #Asembia17.

Today marks the seventh year that I will violate Vegas code and tell you what happened there. Below, I offer reflections on key specialty industry trends, DIR fees, patient satisfaction controversies, and a link to the Featured Session slides. You’ll also find a few incriminating photos! Please add your own observations and photos to the comments section below.

Partnering with IDNs BioPharma Strategy Summit

Partnering with IDNs BioPharma Strategy Summit
August 16-17, 2017 | Philadelphia, PA

As health systems continue to grow and consolidate to form major Integrated Delivery Networks (IDNs), manufacturers are tasked with learning how to best contract with, and sell to, these evolving systems to ensure product success. With conflict of interest policies in place and restricted access to physicians, manufacturers are changing their sales approach to better reach and engage these new customers.

CBI’s Partnering with IDNs Strategy Summit convenes manufacturers and IDNs to discuss how to create a mutually beneficial partnership that contributes to continual care coordination, strategic product management and enhanced access.

Drug Channels readers will save $400 off the standard registration rate
when they use discount code QJF259.*

Key Explorations Include:

• The IDN model of patient care coordination and what it can do to improve the patient experience on behalf of the provider, manufacturer, payer and other stakeholders
• Changes in the hospital reimbursement model, focused on quality tied to outcomes measures
• Effective ways manufacturers can partner with health systems
• Understand the size and scope of the current US hospital marketplace and the GPO’s contracting relationships with those providers
• Explore implications of value-based RWE on the healthcare manufacturing community in terms of contracting, distribution, and consumer engagement with payers and providers
• Gain perspective on how IDN SPs are gaining manufacturer network access

Confirmed Speakers Include:

• Jeff Prewett, Sr. National Account Director – Oncology GPO & IDN, Lilly USA, LLC
• Anindita Sinha, Director, Business Insights – Market Intelligence, Bayer
• William T. Lee, D.Ph, MPA, FASCP, Pharmacy System Director, Carilion Clinic Healthcare System
• Thomas Felix, M.D., R&D Policy, Intercontinental Region, Amgen
• Jerry Buller, Director, Specialty Pharmacy Services, Vanderbilt University Medical Center
• Michelle Templin, Vice President, Government Affairs and Business Development, MHA ACO Network

REGISTER TODAY!

Visit www.cbinet.com/IDNStrategy for more information. Drug Channels readers will save $400 off the standard registration rate when they use discount code QJF259.*

*Discount may not be combined with other offers, category rates, promotions, or applied towards an existing registration. Offer not valid on workshop only or academic/nonprofit registrations. 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 Weird and Wild Gross-to-Net Adventures of EpiPen and Its Alternatives (rerun)

This week, I’m rerunning some popular posts while I attend Asembia’s 2017 Specialty Pharmacy Summit. Click here to see the original post and comments from January 2017.

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Last week delivered significant announcements that will shake up the market for epinephrine auto-injector pens. CVS began promoting a lower-cost EpiPen alternative. Small pharma company Kaléo relaunched the AUVI-Q. Meanwhile, Mylan’s new generic EpiPen continued to gain traction.

It’s a good time to revisit the EpiPen situation and see what it tells us about U.S. pharmaceutical industry pricing. After last week’s announcements, there are now four key products, each with its own list price and rebate arrangements:

• An EpiPen with a $608 list price and rebates to pharmacy benefit manages (PBMs)

• An EpiPen with a $300 list price, but no rebates

• Adrenaclick, an alternative product with a $110 cash price at CVS pharmacies

• Auvi-Q, another alternative, with a $4,500 (!) list price

As I explain below, these variations wonderfully illustrate the warped incentives embedded in our crazy drug channel. Will we make progress in popping the gross-to-net bubble?

Five Industry Trends for U.S. Drug Wholesalers in 2017 (rerun)

This week, I’m rerunning some popular posts while I attend Asembia’s 2017 Specialty Pharmacy Summit. Click here to see the original post and comments from December 2016. FYI: I updated a few links with our more current market data.

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Modern Distribution Management recently published my article 2016 MDM Market Leaders | Top Pharmaceuticals Distributors. It is an excerpt from the 2016-17 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 as we look toward an eventful 2017.

Plan Sponsors Like More Transparent PBMs—Yet Not All Choose Transparency (rerun)

This week, I’m rerunning some popular posts while I attend Asembia’s 2017 Specialty Pharmacy Summit. Click here to see the original post and comments from December 2016.

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Pharmacy benefit managers (PBMs) are facing unprecedented criticism about their business practices and levels of transparency. Which got me wondering: What do plan sponsors—the PBMs’ customers—think about their PBMs?

For the answer, I turned to Pharmacy Benefit Management Institute (PBMI) 2016 Pharmacy Benefit Manager Customer Satisfaction Report (available for purchase.) It rates 11 PBMs based on feedback from more than 500 plan sponsor customers.

The data show a strong association between a PBM’s perceived transparency and a plan sponsor’s satisfaction. As you will see in the charts below, plan sponsors are more satisfied with PBMs that are more transparent.

Yet the causality of this relationship isn’t entirely clear. Smaller plan sponsors tend to work with smaller PBMs, which are rated more highly on transparency and alignment of goals. Are more transparent PBMs truly better? Or, are we observing a selection effect, whereby plan sponsors with fewer internal resources choose PBMs with different business and profit models? And if PBM transparency is so wonderful, why don’t all plan sponsors insist on it?

DIR Fees, Rebates, Pharmacy Economics, and the Future of Medicare Part D (rerun)

DIR Fees, Rebates, Pharmacy Economics, and the Future of Medicare Part D
This week, I’m rerunning some popular posts while I attend Asembia’s 2017 Specialty Pharmacy Summit. Click here to see the original post and comments from February 2017.

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The Centers for Medicare & Medicaid Services (CMS) just released a controversial and important new report: Medicare Part D – Direct and Indirect Remuneration (DIR).

The report shows mixed consequences of DIRs in the Medicare Part D program. For example, manufacturer rebates (the biggest part of DIRs) reduce plan costs and Part D premiums. However, beneficiaries pay higher out-of-pockets costs because coinsurance amounts are based on the undiscounted, pre-rebate retail price. Meanwhile, the government is paying a growing share of drug costs due to catastrophic coverage.

The CMS report has important implications for how we think about rebates, gross-to-net discounts, plan premiums, and patients’ out-of-pocket expenses. That’s why industry reactions have ranged from outrage to defensiveness. I encourage you to read the report and think about how it lays the groundwork for changing the Medicare Part D program.

The Top 15 U.S. Pharmacies of 2016 (rerun)

This week, I’m rerunning some popular posts while I attend Asembia’s 2017 Specialty Pharmacy Summit. Click here to see the original post and comments from February 2017.

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Next week, Drug Channels Institute will release our updated 2017 Economic Report on Pharmacies and Pharmacy Benefit Managers (known in our previous editions as The Economic Report on Retail, Mail, and Specialty Pharmacies)

The exhibit below—one of 143 in our new report—provides a first look at the largest pharmacies, ranked by total U.S. prescription dispensing revenues for calendar year 2016. As you will see, the growth of specialty drugs is reshaping the pharmacy and PBM industries.

For a sneak peek at the complete report, download the free overview. Enjoy!