- My $0.02 on the new Express Scripts-Walgreens alliance
- CMS wants more details on pharmacy-paid DIR fees
- JAMA discovers the drug channel
P.S. My @DrugChannels twitter feed now has an astounding 4,100 followers. Join them and see why!
Express Scripts Subsidiary to Join Walgreens Boots Alliance Development Group Purchasing Organization, PR Newswire
Downstream generic purchasing power has consolidated even further. Two weeks ago, Express Scripts’ Econdisc group purchasing organization agreed to partner with Walgreens Boots Alliance Development (WBAD). It’s the latest capitulation to the inexorable economics of the generic channel. (Walmart surrendered last year.)
Express Scripts is participating via Innovative Product Alignment (IPA), a newly created subsidiary that will gain some price transparency into—and be able to audit—WBAD. Express Scripts is not shutting down Econdisc and AmerisourceBergen will reportedly not gain additional volume from the arrangement. It's too soon to tell how hoppy this IPA will be.
We estimate that following this move, the three largest buyers of generic drugs will account for about 90% of total U.S. generic purchases from manufacturers. For profiles of the largest entities, see section 9.3.4. of our 2017 Economic Report on U.S. Pharmacies and Pharmacy Benefit Managers. The chart below appears in the report as Exhibit 126.
Curious about the origin of WBAD? See the “How WBAD Got Its Name” section of Breaking WBAD: An Update on Walgreens-Alliance Boots Synergies. 😉
Express Scripts is participating via Innovative Product Alignment (IPA), a newly created subsidiary that will gain some price transparency into—and be able to audit—WBAD. Express Scripts is not shutting down Econdisc and AmerisourceBergen will reportedly not gain additional volume from the arrangement. It's too soon to tell how hoppy this IPA will be.
We estimate that following this move, the three largest buyers of generic drugs will account for about 90% of total U.S. generic purchases from manufacturers. For profiles of the largest entities, see section 9.3.4. of our 2017 Economic Report on U.S. Pharmacies and Pharmacy Benefit Managers. The chart below appears in the report as Exhibit 126.
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Curious about the origin of WBAD? See the “How WBAD Got Its Name” section of Breaking WBAD: An Update on Walgreens-Alliance Boots Synergies. 😉
Proposed Medicare Part D DIR Reporting Requirements for 2016, Centers for Medicare & Medicaid Services
Is it time for new Direct and Indirect Remuneration (DIR) reporting?
The Centers for Medicare & Medicaid Services (CMS) requires Part D plans to report extensive data on DIR. Recall that DIR is a broad term that encompasses various types of payments made to a Part D sponsor. For 2014 (the most recent year available,) manufacturer rebate payments accounted more than 94% of all DIR. (See DIR Fees, Rebates, Pharmacy Economics, and the Future of Medicare Part D.)
However, the per-prescription DIR fees that pharmacies pay to Part D plans are one of the pharmacy industry’s most controversial (and least understood) topics. Presumably, that’s why CMS has proposed changing the plans’ reporting requirements for these fees.
For 2015, there were two the pharmacy-related DIR reporting requirements:
The Centers for Medicare & Medicaid Services (CMS) requires Part D plans to report extensive data on DIR. Recall that DIR is a broad term that encompasses various types of payments made to a Part D sponsor. For 2014 (the most recent year available,) manufacturer rebate payments accounted more than 94% of all DIR. (See DIR Fees, Rebates, Pharmacy Economics, and the Future of Medicare Part D.)
However, the per-prescription DIR fees that pharmacies pay to Part D plans are one of the pharmacy industry’s most controversial (and least understood) topics. Presumably, that’s why CMS has proposed changing the plans’ reporting requirements for these fees.
For 2015, there were two the pharmacy-related DIR reporting requirements:
- DIR #8 – Generic Dispensing Incentive Payments and Adjustments
- DIR #9 – Other Pharmacy Incentive Payments and Adjustments
- DIR #8 – Amounts Received from Pharmacies
- DIR #9 – Amounts Paid to Pharmacies
Financing and Distribution of Pharmaceuticals in the United States, Journal of the American Medical Association
The American Medical Association’s (AMA) premier journal has published a new article that provides a summary view of the U.S. drug distribution and reimbursement system. It’s a bit simplified and misses some important dynamics, but I suppose it has the advantage of being a peer-reviewed primer. Fun fact: Two of the article’s nine citations were written by yours truly!
Asembia’s 2017 Specialty Pharmacy Summit photo album, Flickr
Enjoy some cool photos from this awesome conference. You can read my thoughts on the event in The State of Specialty Pharmacy 2017: Reflections from #Asembia17. Here’s a day vs. night comparison of my time in Las Vegas. See if you can figure out which is which.
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