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Beyond Valeant, U.S. payers scrutinize other drugmaker
ties to pharmacies
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[October 31, 2015]
By Deena Beasley
LOS ANGELES (Reuters) - Express Scripts
Holding Co, the largest U.S. pharmacy benefit manager, is reviewing
pharmacy programs run by AbbVie Inc and Teva Pharmaceuticals Industries
Ltd after finding questionable practices at Valeant Pharmaceuticals
International Inc's partner pharmacy, Philidor Rx Services.
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Express Scripts and other big managers of prescription medicine
benefits for health plans said on Thursday they would no longer work
with Philidor as concerns mount that Philidor was improperly
directing drugs made by Valeant to patients.
Valeant, which has headquarters in Quebec, has since said it was
cutting ties with Pennsylvania-based Philidor, and that the pharmacy
was suspending operations.
A handful of other drugmakers operate their own pharmacies and ship
drugs directly to patients. Many of the rest employ independent
specialty pharmacies that can haggle with insurers and link patients
to programs under which drugmakers cover their out-of-pocket costs.
Such tactics can allow drugmakers to work around reimbursement
restrictions from Express Scripts and other insurers, which are
directing patients to cheaper generic versions of widely-used
medicines to save costs.
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Health insurers, faced with sharply rising drug costs, are
increasing their oversight of prescription drug pricing, which has
also become a key issue in the 2016 presidential election.
"We are reviewing and evaluating all similar captive pharmacy
arrangements that we know of and will work to identify others," said
Brian Henry, a spokesman for Express Scripts. He defined a captive
pharmacy as one that derives the vast majority of prescription
volume from one manufacturer or one product.
AbbVie said its wholly owned Pharmacy Solutions business aims to
help patients and doctors verify insurance coverage in certain
instances for drugs such as its widely-used rheumatoid arthritis
treatment Humira. The company said the program accounts for less
than 0.2 percent of its U.S. sales.
"We believe that Pharmacy Solutions does provide a level of service.
We don't see any change at this time," said AbbVie spokesman Greg
Miley.
Teva's Shared Solutions program helps multiple sclerosis patients
access its Copaxone treatment, which has recently begun to face
competition from generics. The company said in a statement that
approximately 0.5 percent of its sales flow through the company's
pharmacy.
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Both AbbVie and Teva did not respond to requests for further
comment.
CVS Health, the second-largest pharmacy benefit manager, also said
it is continuing to investigate other pharmacies to uncover
inappropriate billing and dispensing activities.
Erik Gordon, a professor at the University of Michigan's Ross School
of Business, noted that independent specialty pharmacies provide an
important service by dispensing expensive and complex products that
require special handling, such as cancer treatments.
That is different from examples like Philidor, he said.
"Captive specialty pharmacies often are a vehicle for drug company
parents to push their own products, especially products that are off
patent and face cheaper competitors," Gordon said.
Shares of Valeant have lost more than half their value since
mid-September as the company came under fire on several fronts, such
as evidence of extreme price hikes for several of its drugs and
allegations that it used Philidor to inflate revenue and circumvent
insurer controls on high-cost prescriptions. Valeant has denied the
accusations.
Valeant said sales of its drugs through Philidor, including acne
medicines and a treatment for toenail fungus, accounted for about 7
percent of its total third quarter revenue.
(Reporting by Deena Beasley; Editing by Michele Gershberg, Chizu
Nomiyama and Mary Milliken)
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