Drugmakers may not be too keen on the formulary management techniques and exclusive deals pharmacy benefits managers have been using to combat rising drug prices. But new numbers from a PBM giant suggest they work--and that pharma better get used to them.
|CVS Chief Medical Officer Troyen Brennan|
Tuesday, CVS Health ($CVS) announced that its prescription drug trend--a metric for growth in prescription spending--had dropped to 5% in 2015, down from an all-time high of 11.8% in 2014. And with many of the usual drivers staying consistent over both periods--including brands and price inflation among generic and specialty drugs—the company is chalking up the drop as proof its tactics are doing their job.
CVS' "proactive pharmacy management strategies were successful in mitigating the impact of rising drug costs in today's highly volatile prescription drug market," it said in a statement, with Chief Medical Officer Troyen Brennan noting that, "[W]e work to help patients avoid unnecessarily expensive medications as part of our focus on making prescriptions affordable."
CVS and its main rival, Express Scripts ($ESRX), have both been actively pruning their preferred formularies over the past few years, with CVS getting the party started back in 2011. At that time, it gave 34 meds the boot as part of a pilot program; by the time it announced its exclusions for 2015, its list tallied nearly 100 drugs and related products, with Express Scripts chipping in with 66 of its own.
Between 2014 and 2015, CVS bade farewell to AstraZeneca ($AZN) diabetes med Byetta, fast-acting Sanofi ($SNY) insulin Apridra, Merck KGaA multiple sclerosis therapy Rebif and sleep aid Lunesta, among others. And the company has shown no signs of slowing down: Monday, Bloomberg reported that it was planning to restrict the use of Valeant ($VRX) toenail fungus treatment Jublia as part of dermatology cost-cutting initiative.
CVS has also struck exclusive deals in hep C and cholesterol, a couple hot therapy areas with high-priced hot-shot newcomers. Early last year, after Express Scripts touched off a pricing war by barring Gilead's ($GILD) hep C meds, the California biotech struck back with a CVS exclusive that knocked out a therapy from nemesis AbbVie ($ABBV). More recently, CVS sided with Amgen ($AMGN) in a battle between two new PCSK9 contenders.
Unsurprisingly, pharma hasn't taken too kindly to the moves, but some companies have been more accepting of the current climate than others. GlaxoSmithKline ($GSK) and Novartis ($NVS), to name a couple, have been working to avoid payers' wrath, with Glaxo moving its attention instead to low-priced OTC products and vaccines and Novartis trailblazing with pay-for-performance deals.
- read CVS' release
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