Industry Voices—3 ways payers, PBMs can team up to save on specialty drugs

Today’s advances in medicine enable the successful management of diseases for which there were once few effective treatment options.

However, innovative specialty medications come at a cost upward of thousands of dollars per dose.

In fact, specialty drugs are so expensive that they drive 40% of today’s prescription spending while treating less than 1% of the patient population. National strategies for managing the cost of these drugs include promoting biosimilar development and increased competition, but there are steps plan sponsors can take now with pharmacy benefit managers (PBMs) to address spending on specialty drugs.

Improved care coordination and communication

Controlling specialty spend is about supporting patients and working with their healthcare team to ensure that treatment is safe and effective. Medications that don’t work as they should translate to poor health outcomes, which drive up overall costs.

PBMs are perfectly positioned to work with all members of a patient’s healthcare team to improve communication. PBM pharmacists have access to all data gathered from prescription claims and, potentially, integrated medical claims data. This allows them to see a comprehensive picture of the patient’s medication history, diagnoses, lab results, indicators of adherence and other applicable medical data. As a result, PBM pharmacists can alert prescribers and retail pharmacists of any issues and facilitate the identification of safer, more effective treatment options.

Specialty pharmacists and nurses should speak directly with their patients as well about the medications they’re taking and how they’re feeling. This dialogue develops a rapport, trust, empathy and understanding. It also allows these clinicians to work with the patient’s healthcare team to address any challenges that may arise—such as poor medication adherence due to intolerable side effects or complicated dosing schedules.

Through this outreach, the PBM becomes a patient advocate, bringing all members of a patient’s healthcare team together to find treatments that deliver the best value and outcomes.

Advanced clinical programs

To be able to provide effective care coordination, PBMs must also offer comprehensive, advanced clinical programs. Prior authorization provides an example of how clinical programs are not created equal. The intention of prior authorization is to make certain medications are used appropriately. But does the analysis review whether the medication is appropriate for a specific individual’s needs? Not all prior authorization programs do. A comprehensive program considers whether there are warnings and contraindications related to factors such as the patient’s age, health conditions, metabolism, lifestyle or other medications they may be taking.

Advanced clinical programs are proactive, delivering vital information before a medication is dispensed so adjustments can be made without putting patients at unnecessary risk. This can reduce spending by preventing serious adverse drug reactions or wasteful drug utilization.

In addition, quantity limits can be used to eliminate excessive spending by cross-referencing the amount of medication being dispensed with the actual amount of medication being billed. For example, if the quantity in a prefilled syringe is rounded up for billing, the plan sponsor is overcharged. For specialty medications costing thousands of dollars, the financial impact is significant.

Creative contracting and partnerships

Finally, plan sponsors need a PBM that works with them, putting the plan’s and patients’ best interests first while delivering ethical, transparent benefit management. They should consider PBMs that tie performance guarantees directly to their clinical programs. A pay-for-performance arrangement holds the PBM accountable for how well it facilitates responsible, effective drug utilization that reduces the plan’s spending.

In addition, plan sponsors can seek out direct savings by partnering with a PBM that provides actual acquisition cost pricing on specialty medications. This means that the plan sponsor pays exactly what the pharmacy pays for the medication, without any markup or spread generating hidden revenue.

Specialty medications are an increasingly important part of the drug spending equation. Rather than wait for external factors to drive savings, such as competition and biosimilar development, plan sponsors should challenge the status quo, ensuring their PBM partners are transparent and proactive. Specialty spending can be controlled by making strategic choices in PBM relationships that support better patient care and drive transparent, accountable programs and results.

Michael A. Perry is the president of BeneCard PBF, an innovative PBM that engineered a purely transparent pharmacy benefit management model along with a pure pass-through program. BeneCard PBF’s approach centers on clinical programs that drive costs down while helping improve member health outcomes

https://www.fiercehealthcare.com/payer/industry-voices-3-ways-payers-pbms-can-team-up-to-save-specialty-drugs

Intuitive Surgical CEO Cracks The Da Vinci Code Of Success

What do a dedicated math teacher, an honest college prof and a lousy jump shot have in common? The Intuitive Surgical CEO followed each to find success.

How? Gary Guthart, Intuitive Surgical (ISRG) CEO since January 2010, pulls together seemingly random events from his past, lessons from mentors and disappointments to extract the best outcome from opportunities he gets.

Much of Guthart’s experience traces back to growing up in Sunnyvale, Calif. It’s the heart of Silicon Valley. It was also, he told Investor’s Business Daily, a great place to grow up in the 1960s and ’70s “if you were a math and science kid.”

“Both my parents worked, which was unusual at the time,” Guthart, 54, said. Some kids might have seen busy parents as a negative. But opportunity arose. Guthart’s calculus teacher saw a student with potential and both parents at work. He signed Guthart up for an internship at NASA.

“(My teacher) told me, ‘I want you to go check this out,'” Guthart said. “So I got on my bike (and) went to the research center.” There, he met a second professional mentor, Sandra Hart, “then the only female director of a NASA lab,” he said. She put him to work writing software code that examined how pilots learn.

The job sparked Guthart’s interest in science. He saw the intersection “of how people and technology interact. Not technology for its own sake, but how the two go together,” he said.

The mindset of a future Intuitive Surgical CEO was born.

Bringing A Winning Mindset To Intuitive Surgical

This link between man and machine is the core of Intuitive Surgical. The company is a game changer in the field of robotic surgery. Its da Vinci surgical systems help surgeons perform successful and delicate procedures.

The company also enjoyed enviable success with Guthart at the helm. In the roughly ten years Guthart has been Intuitive Surgical CEO, the stock jumped nearly 500%. That easily outpaces the S&P 500’s 195% rise during that time. And the company’s revenue is on pace to hit $5.1 billion this year, up 380% from when his CEO tenure began. The company is seen earning $1.4 billion in 2020, says S&P Global Market Intelligence. That’s up more than 350% from 2010.

Guthart, who joined Intuitive Surgical in 1996, also served as its president from July 2007 through 2019.

Intuitive Surgical CEO: Focus On Your True Strengths

Guthart earned a Ph.D. in engineering from the California Institute of Technology. His plan? To teach. His thesis advisor urged him to contact a Massachusetts Institute Technology professor about opportunities. He did not get the help he thought.

Guthart recalls the MIT professor telling him: “Gary, I’m not going to (help) because I don’t think you’re going to be a good enough professor. You like to talk to people. That’s not what professors do. You have to write. It’s really a solitary profession.”

Guthart didn’t like what the honest professor told him. “I told myself, I’ll show him, and I kept looking for (teaching opportunities). I got a couple of offers, but finally realized that he was right,” Guthart said. “He did a hard thing (by being honest), and he did me a huge favor.”

Jump At Opportunity No Matter Where They Come From

Guthart, instead, got a job at SRI (formerly the Stanford Research Institute). His jump shot languished, though. Good thing. He and a group of fellow researchers met regularly at lunch for a pickup basketball game. And Guthart sat on the sidelines — again — when Ajit Shah approached him. Shah ran SRI’s robotics lab. He wanted to add to his staff.

Shah took Guthart back to his lab. He asked Guthart to sew a dead rat’s blood vessel using a microscope.

“I was a model builder as a kid, so I was pretty good with my hands, but it was really hard,” Guthart recalled. “Then he sat me down with the SRI prototype. It was substantially easier.” Shah told Guthart his team’s research aimed to put robots in the hands of surgeons. And he asked if Guthart would help.

Guthart transferred to Guthart’s group. Intuitive Surgical’s founders noticed the SRI group’s work. And they licensed the technology when they formed the company. Guthart joined as employee number 11. It seems like a no-brainer now, but, at the time, it was a risk.

“My first response was no. I’d just gotten a promotion. And John Freund (one of three Intuitive Surgical founders) … convinced me to come over. He said, ‘If you want to be a researcher, come and you’ll be a better researcher.’ I sat down with my wife — we had our first child — and she said do it now.”

Ask For Help So You Can Focus

Guthart started writing machine code that allows the elements of the robot to connect smoothly. But he hit the wall. “I just couldn’t work fast enough. There weren’t enough hours in the day,” he said. “I’d come in early, work all day, drive home to have dinner with my wife and drive back to the office.”

Guthart saw opportunity, again. He asked to hire help. The founders agreed, but added, “we have no revenue so hire someone good,” Guthart said. He asked around and colleagues pointed him to Gunter Niemeyer from MIT. Niemeyer was the right choice.

“He could do in a few hours what took me a full day. He was just that much faster and a humbling choice,” Guthart said. “It taught me that being a manager started with hiring really great people and letting them push you out of the way.”

Aim Higher Than You Think Possible

In the late 1960s, surgeons developed minimally invasive surgery (MIS) techniques. Instead of making large holes in the body, MIS required only small ports. The ports allowed surgeons to put in a long lens. They could use tools like scissors to snip and retrieve unwanted tissue.

Guthart and Intuitive Surgical saw an even better way. But they knew slight improvements wouldn’t sell. Advances needed to be radical.

“We made a few key decisions early on. If (a surgeon or hospital) was going to adopt something new, it had to be something much better,” he said.

The company went through a series of breakthrough robotic surgery prototypes. The first was Mona (as in Lisa). And the final was da Vinci. After much testing and success in Europe, the FDA approved da Vinci for laparoscopic surgery in the U.S.

Sign Up Allies

Sales took off when a Swiss urologist working in Frankfurt, Jochen Binder, saw da Vinci could help with prostate surgery. He showed it to peers. Mani Menon, a surgeon at Detroit’s Henry Ford Health System, became an enthusiastic user. Support grew.

Menon watched Guthart build the company. “(Guthart is) used a scientific method to collect data and took notes,” Menon said. These notes prompted Intuitive Surgical to modify instruments to help urologists.

The company still faced a big hurdle. High-ego surgeons resisted change. This was relatively easy to correct, though, because of the ease of robotic surgery and the better outcomes.

Intuitive showed its equipment at surgical gatherings. At one, a young resident exclaimed: “I’ve just spent seven years of my life learning to do (surgery) laparoscopically with sticks and now” — he points to a security guard — “he can do it.”

Be A Salesperson With Facts

Convincing hospitals to buy the equipment proved more difficult. Simply, da Vinci was expensive: $1.5 million at the time. Hospitals have a number of financing options now. But those choices didn’t exist early on.

So Guthart relied on stats. “Hospitals were fixated on the cost of capital equipment. But there are all kinds of costs beyond the equipment: the surgeon, the anesthesiologist and scrub nurse, the overhead of running the hospital,” he said. “What really matters is the total cost of treating the patient.”

Community hospitals signed on first. Smaller facilities were “looking for the efficiencies.” The robotics surgery also provided a marketing tool.

See A Bigger Opportunity

Alan Mendelson, who worked with Intuitive Surgical as legal counsel, credits Guthart for the company’s growth.

“Gary’s ability to transform (Intuitive Surgical) … from a small, single-product company to a large 7,000-plus person organization without losing the culture, soul, and focus on what enabled the company to initially succeed,” he said.

So it seems, in the end, Guthart’s choices were a slam dunk.

Intuitive Surgical CEO Guthart’s Keys

• Rose from a programmer at fledgling Intuitive Surgical to president and then CEO in 2010. Helped the company manage explosive growth the past decade.
• Overcame: Resistance by doctors and hospitals to trust, and pay for, robotic-aided surgery equipment.
• Lesson: Spot and take advantage of opportunity wherever it comes from. Your path to success may not be what you expected.
• “When I came out of school my thought process was to find a great technology.”

https://www.investors.com/news/management/leaders-and-success/intuitive-surgical-ceo-cracks-the-da-vinci-code-of-success/?src=A00220&yptr=yahoo

Virus spreads to more Chinese cities, President Xi says containment is priority

An outbreak of a new coronavirus has spread to more Chinese cities, including the capital Beijing and Shanghai, authorities said on Monday, and a fourth case has been reported beyond China’s borders.

China’s National Health Commission confirmed that the virus, which causes a type of pneumonia, can pass from person-to-person, the official Xinhua News Agency said.

President Xi Jinping said curbing the outbreak and saving lives was a top priority as the number of patients more than tripled and a third person died.

Adding to the difficulties of containing it, hundreds of millions of Chinese will be traveling domestically and abroad during the Lunar New Year holiday that starts this week.

Authorities around the globe, including in the United States and many Asian countries, have stepped up screening of travelers from Wuhan, the central city where the virus was first discovered.

“Wuhan is a major hub and with travel being a huge part of the fast approaching Chinese New Year, the concern level must remain high. There is more to come from this outbreak,” said Jeremy Farrar, a specialist in infectious disease epidemics and director of the Wellcome Trust global health charity.

Authorities confirmed a total of 217 new cases of the virus in China as of 6 p.m. local time (1000 GMT) on Monday, state television reported, 198 of which were in Wuhan.

Five new cases were confirmed in Beijing and 14 more in Guangdong province, the report said. Another statement confirmed a new case in Shanghai, bringing the number of known cases worldwide to 222.

“People’s lives and health should be given top priority and the spread of the outbreak should be resolutely curbed,” President Xi was quoted as saying by state television.

The virus belongs to the same family of coronaviruses as Severe Acute Respiratory Syndrome (SARS), which killed nearly 800 people globally during a 2002/03 outbreak that also started in China.

Its symptoms include fever and difficulty in breathing, which are similar to many other respiratory diseases and pose complications for screening efforts.

Zhong Nanshan, a respiratory expert and head of the health commission team investigating the outbreak, confirmed that two cases of infection in Guangdong province were due to human-to-human transmission, Xinhua said. Some medical staff have been infected, it added, but gave no number.

BEYOND BORDERS

South Korea on Monday confirmed its first case, a 35-year-old Chinese national who had traveled from Wuhan, the fourth patient reported outside China.

Last week, two cases were reported in Thailand and one in Japan. All three involved people from Wuhan or who recently visited the city.

A report by London Imperial College’s MRC Centre for Global Infectious Disease Analysis estimated that by Jan. 12 there were 1,723 cases in Wuhan City with onset of related symptoms. Chinese health authorities have not commented directly on the report.

“This outbreak is extremely concerning. Uncertainty and gaps remain, but it is now clear that there is person to person transmission,” Farrar said.

The World Health Organization said on Monday “an animal source” appeared most likely to be the primary source of the outbreak and that some “limited human-to-human transmission” occurred between close contacts.

China’s state council reiterated the government will step up prevention efforts and find the source of infection and transmission channels as soon as possible, state television said on Monday.

Shares in pharmaceutical firms and mask makers in China surged Monday because of the outbreak.

“Who knows how many people who have been to Wuhan may be unaware that they have already been infected?,” said one commentator on Chinese social media platform Weibo

The state-run Global Times newspaper said in an editorial the government needs to disclose all information and not repeat the mistakes made with SARS. Chinese officials covered up the SARS outbreak for weeks before a growing death toll and rumors forced it to reveal the epidemic.

“Concealment would be a serious blow to the government’s credibility and might trigger greater social panic,” the editorial said.

https://www.reuters.com/article/us-china-health-pneumonia/virus-spreads-to-more-chinese-cities-president-xi-says-containment-is-priority-idUSKBN1ZJ001

Jazz Pharma’s Sunosi OK’d in Europe

As expected, the European Commission approves Jazz Pharmaceuticals’ (NASDAQ:JAZZ) Sunosi (solriamfetol) to improve wakefulness and reduce excessive daytime sleepiness (EDS) in adults with narcolepsy (with or without cataplexy) or obstructive sleep apnea (OSA) whose EDS has not been satisfactorily treated by primary OSA therapy, such as continuous positive airway pressure.

Two months ago, the advisory group CHMP adopted a positive opinion backing approval.

The company in-licensed the dual-acting dopamine and norepinephrine reuptake inhibitor from Aerial Biopharma LLC in 2014.

https://seekingalpha.com/news/3532890-jazz-pharmas-sunosi-okd-in-europe

JPM: Glaxo sees enormous Shingrix potential, but supply gap still in the way

GlaxoSmithKline’s Shingrix has generated blockbuster sales quickly after its launch, but numbers touted by the drugmaker this week show the size of the remaining opportunity—and how much supply constraints have held the rollout back.

Glaxo estimates about 115 million people in the U.S. alone are eligible for the shingles vaccine, which requires two doses two to six months apart. The company has reached about 11 million with at least one dose, execs said at the annual J.P. Morgan Healthcare Conference, meaning there are still more than 100 million eligible recipients in the U.S. alone.

In 2018, during its first full year on the market, Shingrix passed the $1 billion mark as the launch roared to life. During the first nine months of 2019, sales reached $1.67 billion.

Shingrix won U.S. approval in October 2017, and, days later, the Centers for Disease Control and Prevention vaccine advisers recommended it for adults 50 and older with healthy immune systems. That strong recommendation caught the U.K. drugmaker unprepared to met demand.

The rollout has surpassed early expectations, but supply constraints have forced GSK to limit deliveries. With its current manufacturing network, GSK can produce “high-teen millions” of doses per year, but that isn’t even meeting U.S. demand. It’s far short of what’ll be needed to fuel a global rollout.

The company is “looking everywhere” to increase capacity, but it’s started to hit a “bottleneck,” GSK’s vaccines president Roger Connor told FiercePharma at JPM. Connor, who previously ran GSK’s pharma manufacturing, took the company’s top vaccines post in 2018.

While GSK is making incremental gains—the company recently pledged a $100 million investment in Montana—GSK’s main capacity expansion will come in the form of a new plant slated to come online in 2024, Connor said. When the drugmaker opens the plant, it expects a “tens of millions” increase in dose capacity.

The complex supply chain features multiple sites at multiple locations around the world, and it’s further complicated by the fact that the vaccine is made up of two components—the antigen and the adjuvant, Connor said.

Before it can open the new site, GSK is doing what it can with current supply. The drugmaker has prioritized people who have received their first dose, and it’s moved to increase supply visibility through an online tracker. The company isn’t yet advertising in the U.S.

As for future launches around the world, those will mostly have to wait as the company is taking a “thoughtful” approach to the global rollout.

“We don’t want to launch and let down our patients and the markets where we have launched first,” he added. “We’ll take our time and do it appropriately.”

Of course, GSK has big ambitions for the vaccine in the years to come. It’s planning to kick off “phased launches” in China and Japan and is also exploring the shot in people under 50 with compromised immune systems. The vaccine will be a growth driver for “years to come,” Connor said.

https://www.fiercepharma.com/vaccines/jpm-gsk-s-shingrix-has-stormed-out-gate-despite-supply-limitations-but-there-s-plenty

Celltrion plans to launch a biosimilar each year for next decade

There are plenty of pharma companies outlining their strategies for the new decade this week at the JP Morgan Healthcare conference, and South Korea’s biosimilars specialist Celltrion was no exception.

Celltrion’s chairman Jung Jin Seo said the company expects to launch a biosimilar every year until 2030, building on its portfolio of already-approved drugs.

Biosimilars are near-copies of biologic drugs, and Celltrion was the first to successfully market a biosimilar of a monoclonal antibody in 2013.

Before its version of Johnson & Johnson/MSD’s Remicade (infliximab) was approved in Europe in 2013, there were doubts as to whether it was even possible to get near-copies of such a complex molecule past regulators.

But Celltrion’s infliximab biosimilar, branded as Remsima, proved a huge hit in Europe and a whole string of other antibody biosimilars have followed, taking market share in the EU and in some cases.

There has also been some success in the US although some biosimilar launches have been delayed because of patent issues.

Since then other companies have also got in on the action – South Korean rival Samsung Bioepis is establishing itself as a biosimilars specialist, while companies such as Amgen, Pfizer, and Teva are also players.

Celltrion cited figures from IQVIA showing that Remsima has overtaken Remicade’s market share, and has around 59% of the market.

Celltrion’s Truxima, a biosimilar of Roche’s cancer drug rituximab, and Herzuma referring to the Swiss firm’s breast cancer drug Herceptin (trastuzumab) have also got the lion’s share of their respective markets.

The company’s strategy is to offer a value-added version of its biosimilars, such as its subcutaneously administered version of Remsima.

This offers a more convenient treatment option than the originator, taking minutes to administer instead of hours and was approved in rheumatoid arthritis in Europe late last year.

Celltrion has applied for an extension of the marketing authorisation to cover the inflammatory bowel disease indication, with an approval expected in mid-2020.

Ho Ung Kim, head of the medical and marketing division at Celltrion Healthcare said, “As a ‘first mover’, Celltrion Healthcare has gained extensive experience in the biopharmaceutical field and is now ready to initiate a direct sales model.

“Celltrion Healthcare has set up its own sales network and overseas offices in 14 countries throughout Europe to secure price competitiveness, and strives to lead the global tumour necrosis factor alpha (TNF-α) inhibitors market with its innovative infliximab Remsima SC, which is projected to be worth approximately $50 billion.”

Celltrion plans to launch a biosimilar each year for next decade

AstraZeneca Prostate Cancer Supplemental Drug Gets U.S. Approval

AstraZeneca PLC (AZN.LN) said Monday that its supplemental new drug application for Lynparza has been accepted and granted priority review in the U.S. by the Food and Drug Administration for patients with metastatic castration-resistant prostate cancer.

The pharmaceutical company said that the Prescription Drug User Fee Act date is set for the second quarter of 2020.

The London-listed company said that Lynparza is also aimed at patients with deleterious or suspected deleterious germline or somatic homologous recombination repair gene mutations, which have progressed following prior treatment with a new hormonal agent.

Results of the PROfound trial showed Lynparza significantly reduced the risk of disease progression or death by 66%, it added.

Prostate cancer is the second-most common cancer in men, with an estimated 1.3 million new cases diagnosed world-wide in 2018 and it is associated with a significant mortality rate, AstraZeneca noted.

https://www.marketscreener.com/ASTRAZENECA-4000930/news/AstraZeneca-Prostate-Cancer-Supplemental-Drug-Gets-U-S-Approval-29862325/