A Publication of Northeast Physicians Hospital Organization  
Specialty Medications / Pharmacy Costs A Changing Game
The pharmacy segment of commercial health plan total medical expenses (TME) for LCPN has increased from ~15% of TME in 2012 to over 20% of TME in Q1.2015. This increase is largely due to the availability and utilization of many new specialty medications and price increases in traditional medications. In 2014, Express Scripts estimated specialty medications accounted for only 1% of all prescriptions but were responsible for 32% of prescription costs.
What is the difference between Specialty &  Traditional Medications?
Specialty medications differ from traditional medications (e.g. antihypertensives, oral hypoglycemics etc.) in the following ways as they:
  • are large complex molecules, often derived from live biological sources that mimic pathways within our bodies
  • usually are intended to treat rare, complex and/or life-threatening conditions
  • may require special storage, handling or administration
  • may need added patient education, ongoing monitoring or clinical management
  • usually have restricted or limited distribution via specialty pharmacies, infusion centers etc.
  • are defined by CMS as >$600 in monthly costs
What are other causes for significant increases in pharmacy costs, projected to trend 15% in 2015? 
  • manufacturers consolidation, drug shortages, and profit taking (e.g. recent purchase of Daraprin, pyrimethamine, by Turing Pharma which increased price from $13 to $750 per tablet)
  • recent increases in costs of traditional medications such as: Levemir / Lantus and other insulins with a 29% increase from Q1 2014 to Q1 2015
  • medication non-adherence which was estimated as  > $100 billion in medication related avoidable costs in 2013
 At the NEPHO October Presentation II meetings for specialists and PCPs, Carol Freedman, NEPHO Clinical Pharmacist discussed Specialty Medications and new Biosimilar medications, their impact on LCPN / NEPHO budgets and strategies for controlling pharmacy costs. (Specialty Medication Presentation). Please feel free to contact Carol Freedman at [email protected] or 978-236-1774 if you have any questions.
    Drugs for Type 2 Diabetes
  • The American Diabetes Association (ADA) and the American Association of Clinical Endocrinologists (AACE) recommend that in addition to lifestyle modification, metformin is first-line for the treatment of type 2 diabetes in most patients.1,2
  • In general, target A1C concentrations are 7% (ADA) or 6.5% (AACE), but the goal may be individualized for patients with other illnesses and in those at risk for hypoglycemia.1,2
  • Therapy can be started with more than one agent in patients with an A1C ≥9% (ADA) or ≥7.5% (AACE). However, for patients who fail metformin monotherapy, a broad variety of agents can be used in combination with metformin, or as monotherapy in those who cannot use metformin.1,2
  • The choice of 2nd-line and 3rd-line agents varies based on patient characteristics, patient preferences, and properties of the medications such as the risk of hypoglycemia or weight gain.
  • Glyburide should be avoided (use glimepiride or glipizide) if a sulfonylurea is selected, due to more hypoglycemia and weight gain, particularly in the elderly.
  • Please see the attached table for Drugs for Type 2 Diabetes summarizing the agents available including DPP-4 inhibitors, GLP-1 incretin mimetics and SGLT2 inhibitors for the treatment of type 2 diabetes, with the following information:
    • expected A1C reduction
    • mechanism of action
    • dosing
    • cost estimate
    • advantages and disadvantages 
Reference: Drugs for Type 2 Diabetes. Pharmacist's Letter/Prescriber's Letter. June 2015.
Produced by Northeast PHO.  For more information contact: 
Carol Freedman, RPh, MAS, CGP 
Clinical Pharmacist NEPHO 
[email protected] 
Les Sebba M.D., Northeast PHO Medical Director 
[email protected]
October  2015
     Volume 5 :  Issue 7      
In This Issue
Open Enrollment for Medicare Part D
Medicare beneficiaries are eligible for enrollment in Part D prescription plans beginning on October 15, 2015 through December 7, 2015.  Prescription drug plan premiums will remain stable at about $32.50 per month, up from $32 in 2015.  Premiums for specific plans and regions may vary from year to year. It's important for Medicare beneficiaries to examine their annual notice of change (ANOC) carefully to determine if and how their plan's costs or benefits may be changing and if it makes financial sense to explore other options
In 2016, beneficiaries will continue to get a 55% discount on brand-name drugs during the coverage gap (donut hole)which now begins after $3,310 in prescription expenses for the beneficiary and their plan. The discount on generic drugs will increase from 35% to 42%.
Beneficiaries should review their ANOC and the summary of the new formulary in particular to make sure their prescriptions are still on the list. People who want to change plans should make sure the plans they are considering cover their prescriptions. If the summary of the new formulary does not include a beneficiary's prescriptions, patients may find the full formulary online or call the plan to request it.
The Medicare on-line plan finder tool can be helpful for beneficiaries with questions or changes in their medications. www.medicare.gov/find-a-plan.
In 2016, CMS will expect Part D plans to use more transparent names for drug tier labels. As the prices of some generic drugs rise, plans may move the highest-cost generic drugs into nonpreferred brand tiers that require beneficiaries to share more of the cost.
Visit www.nepho.org for valuable information, including: calendars, health plan information, fee schedules and more.