Hand-to-hand combat continues in the PBM formulary trenches

Pharmaceutical CommercePharmaceutical Commerce - July/August 2010

CVS Caremark updates its list of blocked drugs that will not be available on its formularies, in part to battle manufacturers’ copay programs

The skirmishing continues between CVS Caremark, the US’ second-largest pharmacy benefit manager (PBM) and manufacturers whose drugs CVS considers to be of minimal value or that have lower-cost (often generic) alternatives. According to a Nov. 9 Wall Street Journal article, the company has added 17 drugs to an earlier list of 30 (with some reinstatements occurring as well) that will not be covered in plans it manages, starting Jan. 1. According to the WSJ, the blocked drugs include Pfizer’s Genotropin human-growth hormone and Detrol-LA urinary treatment , Allergan’s Lumigan glaucoma drug, and the diabetes treatment Onglyze from BMS and AstraZeneca, and Abbot’s Androgel low-testosterone treatment. But Lilly’s and Boehringer-Ingelheim’s Tradjenta diabetes treatment, and low-testosterone therapies from Lilly (Axiron brand) and Endo Health (Fortesta brand) are reinstated.

The dynamics of drug formularies are complex: PBMs start by putting more-expensive or (what they consider to be) less efficacious drugs on higher formulary tiers, necessitating higher patient copays. Manufacturers have responded in some cases with copay assistance, reducing the financial burden on patients. At the same time, manufacturers are weighing which drugs warrant a higher discount to the PBM, versus the funding of copay assistance. And PBMs have to worry about disgruntled plan managers at employer groups and others that contract with the PBMs. CVS Caremark, according to the WSJ article, makes compliance with the blocked list voluntary, but also offers a rebate incentive to plans if they comply. Back of all of this are hospitals and insurers that can often see better therapeutic outcomes (and lower healthcare costs) when patients stay on therapy.

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