Biotechnology Healthcare - November/December 2008 - (Page 44) SPECIALTY PHARMACY When It Comes to SP, Employer Size Matters Scott Kober, Contributing Editor O ver the past few years, when F. Randy Vogenspecialty pharmaceuticals, so that clients can take the first berg, RPh, PhD, chief strategic officer for Emsteps toward preparing themselves. His message, though, ployer-based Pharmaceutical Strategies (EPS), is duly noted: Employers of all sizes — much as they may has walked into an employer client’s office to want — can’t close their eyes to specialty pharmacy. discuss specialty pharmacy trends, he is greeted with a With 15- to 20 percent annual growth rates, specialty smile and a pat on the back. When he walks out a few hours pharmacy spending is expected to hit $120 billion by 2012. later, those smiles have largely disappeared. Although use of individual specialty products And, at best, he gets a limp handshake. is still primarily restricted to small populaIt’s nothing personal against Vogenberg, tions with a limited number of medical condibut merely the response to his message that the tions, Debbie Stern, RPh, vice president at Rximpact of specialty pharmacy will soon make perts, says that “Some employers are starting their pharmacy benefit plans obsolete and in to see one or two specialty drugs sneaking toneed of a complete overhaul. ward their top 20” in terms of drug cost. “Before they talk to me, very few employ“From an employer perspective, specialty ers really understand the impact that specialty pharmacy and specialty pharmacy trends are pharmacy is going to have,” Vogenberg said. hard things to get your arms around, no mat“And then, after I show them [Centers for Small employers often ter what size you are,” Stern says. “There is must reach out for help Medicare and Medicaid Services] data high- in order to grasp the very little in the medical literature right now that lighting how specialty is going to overwhelm complexities of speclearly demonstrates the financial cost offset of them by 2015 like a tsunami, that’s when they cialty pharmacy, says these products — which is where the difficulty start to see that they will have to make tough Michael S. Jacobs, RPh, comes in.” decisions. My mantra has been that they have at Buck Consultants. The complexity of specialty pharmacy isto redesign their benefits altogether because sues undoubtedly contributes to the mystery. In the current pharmacy design doesn’t work for specialty.” a Buck Consultants survey this year, titled “Understand Vogenberg admits that his doomsday scenario is a bit Your Strategies for Coping with the Changing Pharmacy overly dramatic and that his primary goal isn’t really to inBenefit Landscape,” 28 percent of employer respondents duce cardiac arrest. He is merely trying to open clients’ said they did not know what percentage of their total phareyes to the continuing growth and financial impact of macy expenditure is for specialty medications. And while the depth of which a benefits manager at a 5,000-employee company must understand specialty pharmacy differ sigPercentage of total pharmacy expenditure nificantly from that of a 500-employee company and more devoted to specialty medications still from that of a 50-employee company, the days of any Responses of 121 employers to a recent survey size employer being able to bury their heads in the sand when it comes to specialty pharmacy are dwindling quickly. Specialty pharmacy’s portion of total annual pharmacy costs 0–5 percent 6–10 percent 11–15 percent 16–20 percent 21–25 percent More than 25 percent Don’t know Source: Buck Consultants 2008 Percentage of respondents 35 17 11 7 1 1 28 THE 5,000-EMPLOYEE COMPANY Factoring in spouses and children, companies with 5,000 employees typically cover approximately 12,000 lives. That amount is generally large enough so that, whether you are based in Connecticut or California, there will be a predictable prevalence of chronic conditions, such as heart disease or chronic obstructive pulmonary disease. Consequently, predicting year-to-year spending for drugs to treat these conditions is a straightforward, linear process. Not so for specialty pharmacy. Even for large, selfinsured employers, the numbers of patients treated with 44 BIOTECHNOLOGY HEALTHCARE · NOVEMBER/DECEMBER 2008
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