What Does This Emerging Trend Hold for Branded Agents?
Asthma and chronic obstructive pulmonary disease (COPD) are chronic diseases of the airways affecting millions of Americans and representing a costly health expense for the nation’s healthcare payers. The chronic symptoms of COPD and asthma can be controlled through the use of several long-acting inhalers such as GlaxoSmithKline’s Advair (salmeterol/fluticasone propionate) and Boehringer Ingelheim’s Spiriva (tiotropium). For these two chronic conditions, the lack of generic alternatives due to patented delivery systems has kept drug prices high. The rising costs of pharmaceuticals and medical services in general have prompted health insurers to turn to accountable care organizations (ACOs) to manage the health risk of their membership. Surveyed MCO pharmacy and medical directors and physicians predict that ACOs can generate, on average, double-digit savings on medical and drug costs for both asthma and COPD. ACOs are making pulmonologists and allergists more conscious of the long-term consequences of each prescribing decision by linking their reimbursement to the achievement of goals such as reducing hospital readmissions and total medical costs as well as saving on prescription drug costs. The ACO focus on cost-cutting drives prescribers to generic competitors of brand-name drugs, a trend that will accelerate starting in 2016 when several market-leading branded drugs lose patent protection, including Advair, GlaxoSmithKline’s Flovent (fluticasone propionate), and AstraZeneca’s Symbicort (formoterol/budesonide).
Questions Answered in This Report:
- Establishment of ACOs: With how many ACOs on average do MCOs contract? How many beneficiaries and providers are participating today and in 12 months’ time? What indications are being targeted as part of ACOs, now and in 12 months’ time? What level of risk-taking are ACOs assuming, and what incentives are at play now and expected to be in the future? What are MCOs’ enrollment, cost, and quality goals for their ACOs? What is the minimum size an ACO must be to establish its own formulary, according to payers and physicians?
- ACOs’ impact on prescribing behavior: What performance and efficacy measurements are payers using to determine bonus payments to physicians and hospitals? How are these measurements likely to influence prescribing behavior in the treatment of asthma and COPD? How will financial incentives influence physician prescribing of brands versus generics? How do physicians react to the emerging interleukin-5 (IL-5) therapies for asthma in 2015, as well as new COPD drugs? How would MCO pharmacy and medical directors and physicians like the pharmaceutical industry to partner with them in the context of ACO contracting? How much weight do MCOs ascribe to competing goals, such as reducing prescription drug costs versus reducing hospitalizations?
- Presence and role of distinct ACO formularies: Which formularies are ACOs following, now and in 12 months’ time? What is the difference between an ACO formulary and traditional formulary in terms of coverage of specific branded and generic drugs for asthma and COPD? What specific brands among the ICS, LABA/ICS, leukotriene inhibitors, and other classes are being favored in the ACOs? Is prescription drug spending included in the ACO cost measurements? How is that measurement influencing prescribing behavior for specific branded and generic drugs for asthma and COPD? What is the magnitude of this influence? How do payers expect ACOs to affect medical costs and prescription drug costs? What are payers measuring as part of ACOs?
This U.S. Physician & Payer Forum reveals physicians’ and payers’ insights into the changes in prescribing practices in the United States for asthma and COPD drugs due to participation in ACOs. The report is based on a survey of 101 specialists—including 66 pulmonologists and 35 allergists—as well as 23 medical directors and 17 pharmacy directors at MCOs that currently contract with ACOs or expect to do so within 12 months. We highlight reimbursement arrangements, formulary restrictions, metrics tied to provider compensation, and other factors that influence decisions to use branded drugs or generic alternatives. The report explores opportunities for drug developers to advocate for their brands consistent with ACO goals and to protect or expand their market share. Specific therapies examined within the ACO context include GlaxoSmithKline’s Anoro, Advair, Breo, and Incruse; AstraZeneca’s benralizumab, Pulmicort, and Symbicort; Teva’s Cinquil and QVAR; Novartis’s Arcapta and Ultibro; Genentech/Novartis’s Xolair; Merck’s Dulera and Singulair; and Boehringer Ingelheim’s Atrovent, olodaterol/tiotropium, and Spiriva. The report also examines emerging therapies for asthma and COPD, including the class of interleukin-5 (IL-5) inhibitors launching in 2015 for asthma and LABA and LAMAs.
Markets covered: United States.
Primary research: Online survey of 101 physicians—66 pulmonologists and 35 allergists—and 40 MCOs (23 medical directors and 17 pharmacy directors).
Epidemiology: Asthma and COPD.
Population segments: Our analysis involves patients covered under Medicare, Medicaid, and commercial health plans.