Express Scripts adds 64 medications to its no-go list, hitting Lilly and Amgen but sparing diabetes

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Express Scripts unveiled its 2018 preferred drug formulary on Monday.

When Express Scripts unveils its national preferred formulary each year, industry watchers immediately look to its decisions for clues about trends in the drug business. It’s no different this year, with several new exclusions—or a lack thereof in some fields—indicating where things are headed.

One notable exclusion was Lilly’s blockbuster osteoporosis drug Forteo in favor of Tymlos from Radius Pharmaceuticals. Upon its April approval, Radius priced its new entrant at a discount to the old guard from drug giant Eli Lilly, a move that may have played a role in the former company’s new favorable position with the nation’s largest benefits manager. Forteo brought in $1.5 billion for Lilly last year.

Express Scripts' new formulary, which encompasses 83 million insurance plan members, added 64 drugs to its list of those excluded from coverage. 

During an interview last month, Express Scripts CMO Steve Miller highlighted Tymlos and a few other new medications as evidence pharma is willing to increasingly compromise on pricing. Express Scripts said its list of exclusions will save $2.5 billion in drug costs.

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On the other side of the coin, Synergy Pharmaceuticals didn’t secure a preferred formulary position for its new chronic idiopathic constipation entrant Trulance. After a January approval, that drugmaker priced its medication on par with Allergan’s Linzess, at $353 per script, and just higher than Sucampo and Takeda's Amitiza, which costs $350. Those two medications will serve as Express Scripts’ preferred choices for the upcoming year. Synergy is still in negotiations with the PBM giant, a spokesperson told FiercePharma.

In its Monday announcement, Express Scripts projected formulary exclusions will create $2.5 billion in drug savings next year.

Elsewhere, a lack of new exclusions in diabetes and immunology likely means Express Scripts was able to negotiate “sufficient discounts to retain broad coverage,” Bernstein analyst Ronny Gal wrote in a Monday note. In diabetes, he said, it “likely means weak pricing.”

For multiple sclerosis, however, he wouldn’t make the same conclusion from a lack of new exclusions. That likely means a “continuation of the lightly managed approach” in the field, he wrote.

RELATED: Synergy preps for Trulance launch with competitive pricing, experienced GI reps

On biosimilars, Express Scripts’ decision to exclude Amgen’s white blood cell booster Neupogen from its formulary in favor of Zarxio from Sandoz is a “shot across the bow” for branded drug companies, according to Gal. The analyst noted the impact from the decision is “modest” as only 5% of Neupogen’s market is managed under the pharmacy benefit, while the rest is under the medical benefit.

But, Gal continued, the move is an indication Express Scripts “will be willing to force-switch chronic patients from an innovator product to non-interchangeable biosimilar.” The PBM had already favored Eli Lilly and Boehringer Ingelheim's basal insulin biosimilar Basaglar over its reference product, Sanofi's Lantus.

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Another notable but perhaps unsurprising exclusion is epinephrine injector Auvi-Q, launched earlier this year at a price of $4,500 by Kaleo Pharma in an attempt to steal share from Mylan as it suffered from negative pricing attention.

At the time, an Express Scripts spokesperson called Kaleo’s move "another egregious pricing scheme that will attempt to gouge payers and damage our healthcare system." Express Scripts has opted to go with Mylan’s EpiPen for the next year.