Specialty Pharmacy Spend
–
Using @Risk to Sell Value to Clients
in the High Cost Arena
November 2011
Introduction
2
March 23, 2010
3
Headlines
4
5
Specialty Pharmacy Examples
Oral Chemotherapy
Hepatitis C
6
Retail Pharmacy
Rxs per person: 10.9
Cost per Rx: $60
Drug spend per person: $654
7
Retail Pharmacy
Population:
Total Rxs:
12,800,000
139,520,000
Drug Spend: $8,371,200,000
8
Retail Pharmacy
$8,371,200,000
Population:
Total Rxs:
12,800,000
139,520,000
Drug Spend: $8,371,200,000
9
$0
10
Pharmacy Spend Breakout
Drug Spend ($ in billions)
$2.45
non-SpRx
$2.79
$8.37
SpRx, PBM
SpRx, Medical
11
Total Drug Spend
Drug Spend:
$8,371,200,000
Drug Spend, SpRx (PBM):
$2,790,400,000
Drug Spend, SpRx (Medical): $2,455,552,000
Total Drug Spend:
$13,617,152,000
12
Partnership
WIFM
High-cost drug therapies
Grow market share
Own the territory of “well”
Walgreens
Monitor & control drug spend
Decrease medical spend
Increase productivity
Clients
13
Using @Risk
14
Specialty Pharmacy Example
Oral Chemotherapy
15
Prevalence Rate
12 Million Americans have cancer …right now.
4.0%
16
Incidence Rate
0.47%
1.4 Million
17
Cancer Treatment
25%
75%
18
Oral vs. Injectible
5 in 6 patients are
prescribed injectable
chemotherapy
1 in 6 patients is
prescribed oral
chemotherapy
19
Eligible Patients
1.4 Million
25%
Eligible new patients per year? 70,000
20
Oral Chemo Costs
$4,000
21
Oral Chemo Costs
$1.2 Billion
22
23
33.8%
$78.7 Million
24
Oral Chemo Cycle Management
25
Oral Chemo Cycle Management
Prescription volume
Oral chemo
% receiving chemo
Incidence rate
Amount of wastage
26
Incidence Rates
27
Cancer Treatment
28
State of Illinois – Oral Chemo Spend
29
State of Illinois – Oral Chemo Wastage
30
Expected Values
Spend
58.9 Million
0.037Savings
2.2 Million
31
Expected Values
3.7%
32
Specialty Pharmacy Examples
Hepatitis C
33
1982 – 1989: 31.8%
34
1982 – 1989: 31.8%
1994 – 2006: 45.6%
35
91.8%
36
37
Incidence Rate
0.3 out of 100,000
55% - 85%
75%
38
39
Adherence Rate
96%
82%
Other
Walgreens
40
Impact of Adherence
Adherence < 85% EVR: 29% - 55%
Adherence > 85% EVR: 73%
Walgreens @ 96%
41
Effective!
42
Effective, but not for everyone …
43
11 distinct genotypes
Only Type 1 responds
Type 1 = 70% of Hep C patients
Map courtesy of World Health Organization, 2011
44
11 distinct genotypes
Only Type 1 responds
Type 1 = 70% of Hep C patients
45
46
$35,000 per treatment
47
$35,000 per treatment
$47,000 - $83,000 per
$67,000 - $85,000 per
48
Incidence rate
Cure rate
Cost
Genotype-1
Eligible for treatment
49
Hep C in Illinois
Population:
12,800,000
Expected new Hep C patients: 34
50
34
Hep C in Illinois
10
Acute – not treated
7
Pegasys
14
Incivek
3
Victrelis
51
7Pegasys
14 –
Incivek
3Victrelis
$35,000
each
$75,000
each +
Pegasys
$65,000
each +
Pegasys
$255,000
Total
$1.02M
Total
$215,000
Total
$1,492,209
52
Expected value – Hep C Treatment
53
Cure Rate & Cost of Progression
Hep C
Treatment
Cured
ESLD
Pegasys 7
2
5
Incivek - 14
9
5
Victrelis - 3
2
1
Acute - 10
34
patients
54
Cure Rate & Cost of Progression
11 ESLD patients
$160k per patient
$1.9M total
$3.4 Million – 24 patients
55
Cure Rate & Cost of Progression – no advanced therapies
Treatment
Hep C
34
patients
• $35,000
each
Pegasys 24
ESLD
Cured
6
• $160,000
each
18
Acute - 10
56
Value to a Client
Standard protocol
• 24 patients @ $35,000 each
• $848,625
• 18 patients @ 160,000 each
• $2.93 Million
• Total: $3.78 Million
Enhanced Therapies
• 7 patients @ $35,000 each
• $254,558
• 14 patients @ $75,000 each
• $1.02 Million
• 3 patients @ $65,000 each
• $214,508
• 13 patients @ $160,000 each
• $1.88 Million
• Total: $3.38 Million
57
Value to a Client
Standard
protocol
• Total: $3.78 Million
Enhanced
Therapies
• Total: $3.38 Million
58
Potential Savings
59
Other Applications
60
Citations
1.
2.
3.
4.
5.
6.
7.
8.
Correia, Randall J. , Pharmacy Times, “Oral Oncology Therapies: Specialty Pharmacy's Newest Challenge”,
2011-May-18;
•
http://www.pharmacytimes.com/publications/specialty-pt/2011/May2011/Oral-OncologyTherapies-Specialty-Pharmacys-Newest-ChallengeKohler, Betsey, et al., Journal of the National Cancer Institute, “Annual Report to the Nation on the Status of
Cancer, 1975–2007, Featuring Tumors of the Brain and Other Nervous System”, 2011-Feb-17;
•
http://jnci.oxfordjournals.org/content/early/2011/03/31/jnci.djr077.full.pdf+html
Khandelwal, Nikhil, et al., American Journal of Managed Care, “Impact of Clinical Oral Chemotherapy
Program on Wastage and Hospitalizations”, 2011 Vol. 17;
•
http://www.ajmc.com/articles/AJMC_11JOPmayKhandelwal_e169
Express Scripts Specialty Drug Trend Report, June 2011
Milliman Client Report, “Cancer Patients Receiving Chemotherapy”, March 2010
American Cancer Society, cancer.org
National Cancer Institute, http://seer.cancer.gov/csr/1975_2008/results_merged/topic_delay.pdf
Lo Re III, Dr. Vincent, et al., Clinical Infectious Diseases, “Adherence to Hepatitis C Virus Therapy and Early
Virologic Outcomes”, 2009 Vol. 42
•
http://cid.oxfordjournals.org/content/48/2/186.full