SummaryIn the third episode of the Specialty Pharmacy Stakeholder Perspectives podcast series, Avalere is joined by Dr. Colin Edgerton to discuss the specialty pharmacy dynamics with a focus on the provider outlook.
Kayla: Hello and welcome to Avalere’s third episode in a podcast series focused on specialty pharmacy stakeholder perspectives. My name is Kayla Amodeo, and I am an Associate Principal in the Policy practice at Avalere. Today, I am joined by Dr. Colin Edgerton, a founding member of Articularis Healthcare, the largest rheumatology practice in the United States (US), and also Executive Chairman of the American Rheumatology Network, a network of the largest rheumatology practice in the US who manage a group purchasing organization (GPO), a registry, and value-based contracting. I am also joined by John Neal, who recently joined Avalere as a Managing Director in the Market Access practice. In today’s episode, we will focus on navigating specialty pharmacy dynamics, with an emphasis on the provider outlook and through a market access lens.
To get us started, it is important to level set and understand the basic dynamics of how providers are navigating the specialty pharmacy landscape. I would like to start with you, John. Can you briefly touch on the current state of the business for specialty pharmacies? And Colin, I would love to hear your perspective as well.
John: Yes, sure Kayla, thank you. Hello everyone! Before COVID-19, specialty drug development was a big area of focus for many drug manufacturers. In fact, it was one of the fastest growing drug developments, with over 60% of new approvals happening in the specialty drug space. A lot of these drugs focus on long-term chronic conditions, and because of the cost complexity and management issues with these conditions, specialty pharmacies have become more involved in providing a holistic approach to patient management in collaboration with physicians and health systems. Pharmaceutical companies have also been involved in working with specialty pharmacies in chronic care condition management. They partner with specialty pharmacies for data purchasing, drug adherence services, and education for the management of patient issues (i.e., side effects, etc.). In the specialty pharmacy space, there has been a lot of consolidation, especially with specialty pharmacies like Accredo, CVS, and BriovaRx. All 3 have worked with Pharmacy Benefit Management (PBMs) to purchase many independent specialty pharmacies. Additionally, health systems and hospital systems have been expanding their ability to take care of patients with specialty pharmacies.
Kayla: Great, thank you! Colin, did you have additional perspectives given your firsthand experience with specialty pharmacies?
Colin: Yes, absolutely. That is a great insight John. From the clinician perspective, provider contact with specialty pharmacy is largest centered on the prescribing and prior authorization process. Unfortunately, the prior authorization process is a massive burden for rheumatologist. It often requires trained and dedicated staff within the practice, so therefore any assistance specialty pharmacy can provide – whether that is filling out demographic information on the prior authorization (PA) forms, having an easy to use portal, or having rapid two-way communication with the practice to resolve PA data needs – to ease the PA process is always welcomed. Rheumatologists have been concerned and recognize that PA can be a major barrier to patients’ access. Any additional programs that tend to be layered on top of that process, particularly if they require additional clinician input, are generally viewed with skepticism given the burdens of the process. Another issue that John highlighted is the consolidation in the specialty pharmacy world. These consolidations have shifted the specialty pharmacy focus from seeing the physician or provider as the client, to the PBM or payer as the client. This becomes more apparent in the services or aid that the specialty pharmacy is offering the clinician, as it seems to be part of the PA process, rather than part of the solution.
Kayla: Thank you, Colin. I want to go deeper on dynamics surrounding COVID-19 impacts on American society. It has dominated most conversations. I would like to discuss any impacts this has on rheumatology practices. How will these impacts change how you are navigating the specialty pharmacy landscape?
Colin: Sure. Well there is no question that patient visits are down across the board, regardless of rheumatology practice size or region. The Centers for Disease Control and Prevention (CDC) guidelines have encouraged us to reduce the density of patient visits in the practices. So, not only are you seeing delays or closing of practices, we are seeing a shift to telehealth. These delays have led to fewer starts and fewer changes to prescriptions. Generally, in rheumatology this is because of incomplete clinical data for the provider if unable to see the patient or have limited visit through a telehealth visit. A provider is less likely to change a patient’s therapy until they have better understanding of that patient needs. There are some specific barriers around telehealth, particularly as it relates to rheumatology and the management of other complex and chronic diseases. It is difficult to perform an assessment of a patient through a telehealth platform. For rheumatologist, we use disease activity measures, which generally require an examination of joints to determine tenderness or swelling, and that cannot be done through a virtual platform. Therefore, you will see a lower likelihood for changes in therapies that require disease activity measurement during this time. Finally, I will say that some of the diagnostic testing that is routinely performed, such as laboratory monitoring for medication management or periodic x-rays to treat to target, cannot be done unless the patient comes to the practice. So, even for a stable patient, where you might think a telehealth platform is ideal, there are still some significant missing data points.
Kayla: Those are fantastic insights. John, what are your thoughts on some of the broader market perspective and any shifts you are seeing during the COVID-19 pandemic?
John: Yes, thank you, Kayla. To build on what Colin has mentioned, some of the things we are monitoring are patients’ lack of physician visits and as a result, they may not be getting refills at an appropriate frequency. We are also seeing some physicians and even PBMs allowing for longer prescription fills. So, instead of filling for 30 days and requiring a reauthorization, they are allowing for fills in a longer period of time to ensure patients with chronic conditions can be adherent to their medication. Another interesting area that we are monitoring and advising our clients on is physician infused products – typically reimbursed under Medicare Part B – and assessing if patients are transitioning to a Medicare Part D refill, which can be a self-administered or oral. It is unclear regarding the level in which this is happening since it does require clinician intervention to occur. However, it is something a lot of Avalere’s pharmaceutical clients are interested in, and we are monitoring closely and advising on what we are seeing.
Kayla: That is a fantastic segue to my next question, John. Avalere has had a lot of internal and external conversions, including a recent webinar covering potential shifting site of care considerations, patient switching, and access barriers due to COVID-19. Colin, I am curious to know what you are hearing and experiencing on the frontline with your patients.
Colin: Yes, that has been a big question Kayla. Early on, there was a sense that a lot of the facilities, particularly hospitals, needed to clear out space for potentially expanded COVID-19 treatment wards. There was much discussion on potentially moving those infusions to the community. It is not clear to me if that has happened. I get sense that fortunately, not as many facilities throughout the US were overburdened with the treatment of COVID-19 patients. In the community setting the data shows that the persistence of office administered treatments, like infusions, has exceeded every other service that you see being provided in offices. In the rheumatology setting, within our registry in the American Rheumatology Network, we have seen about a 10% decline over March to April 2020 for infusion services, and that compares to about a 50% reduction in new patient and established visits, and a greater than 50% reduction in other ancillary services, like radiology and laboratory services. There is not the same degree of reduction in services when it comes to infusion therapies. I think some of the oncology observations, particularly from Flatiron’s electronic health record (EHR) system, show similar proportions, where the reduction in office administered therapies, like chemotherapy, are varying by region but are smaller reductions than other services.
There has been some talk about home infusion, though we have site of care concerns in rheumatology. We have clear guidance from the American College of Rheumatology (ACR) around concerns with safety for home infusion, where there is a lack of ability to respond to infusion reactions. For that reason, the ACR prioritizes maintaining these therapies for chronic diseases during the COVID-19 public health emergency in the office setting. That holds true even with a public health emergency, with an infectious upper respiratory virus or not.
Logistically, it is also difficult to change a patient’s therapy. Not because of a lack of equivalent self-administered infusion therapies, but rather because the change means a switch in therapy. And as we talked about regarding some of the limitations of telehealth and physician interaction, it is not the ideal time to be switching therapies given the current circumstances. Switches require prior authorizations, and at a time with less staff or even closed rheumatology practices. There have also been some concerns that once the patient receives their shipment, they may not be taking their first dose before the pandemic starts to subdue. These reasons are significant hurdles to address as far as switching from one site of service to another.
Kayla: It sounds like delays will be a new “normal” right now. John, I am interested in the impacts we may see on the market, taking into the account the insights Colin just mentioned.
John: Sure, I will build on some of the issues Colin mentioned. We are going to see a decrease in utilization, especially in physician-administered and infused drugs. I think the full impact is still ongoing and we are advising our pharmaceutical clients on what that impact may be. One example that I recently read was that Merck & Company, with a drug portfolio that is heavily reliant on physician-administered drugs, recently issued revised second quarter guidance, indicating that they are going to miss their second quarter sales guidance by 2.5 billion dollars. While that is a big number for a big pharmaceutical company, I cannot help but think about the patient impact, especially as patients are missing their treatments or being delayed in treatment. It is an unfortunate situation for everyone involved.
As more home infusions are happening, pharmaceutical clients are concerned about exposure to 340B discounted drug pricing. If more home health agencies are being approved and accredited to provide this service, we may see more shifts to the in-home setting, which pharmaceutical manufacturers will be interested in understanding the impact of that as well. We are looking at our data assets to support learning in this area.
Kayla: Thank you, John. With so much influx right now and many rapid changes, Colin, do you anticipate any lasting changes in your business and in how you will provide care? Or do you have any insights on how patients will receive care moving forward from this public health emergency?
Colin: That is a great question! A lot of which we are still trying to determine. I think the financial impact – typically delayed for many practices that do not have the sophistication to see the impacts of March and April until 30 days later when the claims are paid – on smaller rheumatology practices could be devastating. We are already facing a workforce shortage in rheumatology, where the population that needs rheumatologic care is growing, and the number of rheumatologist and rheumatology professionals is shrinking. We are afraid that the financial stress of the COVID-19 public health emergency will have impacts on the private practices. On the brighter side, if the flexibilities on the regulations around documentation and payment parody for telehealth remain, this would be positive for ongoing treatment of rheumatology patients.
Kayla: John, any thoughts on how the healthcare landscape may look post-COVID-19?
John: Yes, I think you are hearing a lot of this in the news, but the acceptance of telemedicine and telehealth services is going to be a growing trend and more accepted. It should be considered a core offering for specialty pharmacies, as they think of partnering with physicians, health systems, and manufacturers to provide delivery services of the product and holistic management. It will never replace the in-person physician consultation, but I think more people will be comfortable in receiving some level of health care services remotely or via some sort of technology. I recently read in the Boston Journal, that over 80% of respondents of the 200 people surveyed, were becoming more comfortable with receiving some level of their healthcare through telemedicine during this COVID-19 pandemic. We will be monitoring this situation very closely. Anecdotally, my parents, who are in their 70s, had never used FaceTime and have now embraced FaceTime since they can no longer go out and want to see the kids. We are all embracing technology, which I think is a big step.
Kayla: Colin, any closing thoughts as our time on this podcast comes to an end? Time has just flown by and this conversation has been fantastic.
Colin: Absolutely, this has been a lot of fun. We have covered some really important topics. I think that this public health emergency, with the strain it has put on practices, has really highlighted some of the ways we can improve patient access to care. Telehealth and reduction of some of the documentation burden has been a real boom. It has also highlighted some of the difficulties that we face with prior authorization and prescribing medications. It is a real opportunity for all of us to work on these things and ensure patients get rapid access to these needed therapies.
Kayla: Thank you so much, Colin and John, for joining us today. Your insights are invaluable to our listeners. Thank you all for tuning in. Please stay tuned for one last episode in our Specialty Pharmacy Stakeholder Perspectives podcast series. If you would like to learn more, please visit us at Avalere.com.
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