Specialty Pharmacy Providers Deserve Their Own Class of Trade

Pharmaceutical CommercePharmaceutical Commerce - November/December 2009

The emergence of specialty pharmacies, with fundamental differences from other types of pharmacy providers, warrants the establishment of manufacturer relationships

The precedent for any new trade class is evident in the historical evolution of the pharmacy profession into distinct segments that mirror the changing dynamics of healthcare delivery. This transformation has been influenced by pharmacologic and therapeutic advances, prescribing practices and undoubtedly, economics of the target market. Through the relentless efforts of Armada Health Care and its growing constituency of member pharmacies, Specialty Pharmacy is emerging as the newest trade class in the pharmaceutical market. Pharmaceutical manufacturers, government agencies and private payors are beginning to recognize and embrace the advantageous patient-centric services offered by these unique providers.

Over the years, the pharmacy profession has undergone constant service improvements due in part to increased clinical expertise and strategic business development surrounding the targeted patient populations and disease states they manage. Healthcare professionals are all familiar with traditional Acute Care, Long Term Care and Home Health/Home Infusion type pharmacies. Each of these segments (and many others) has been afforded the recognition and resultant professional and economic benefits accruing to a unique “class of trade” designation.

A brief and cursory review of the genesis of pharmaceutical classes of trade reveals a legal foundation rooted in the Robinson-Patman Act of 1936. A related pharmaceutical case is Abbott vs. Portland Retail Druggist, a Supreme Court case rendered in 1976. Collectively, these legislative or legal actions have created a justification for identifying distinct trade channels as “classes of trade,” as defined by the service requirements and economics of each channel. The establishment of a trade class has historically been instituted to recognize a uniqueness in dispensing venue, specific patient population or more importantly, in professional capabilities.

A new relationship with patients

Undoubtedly, Specialty Pharmacy providers meet these criteria. Specialty Pharmacies treat a distinct and well-defined patient population in a number of chronic and acute disease states including, HIV, hemophilia, infertility, organ transplant, multiple sclerosis, rheumatoid arthritis and oncology. The nature of the disease state, the drug treatment modalities, administration, side effect management, cost and the ensuing economic burden all serve to create a highly interactive relationship between the patient, physician and clinical or dispensing pharmacist.

The requisite capabilities for the practice of Specialty Pharmacy include, but are not limited to: management of prescription persistence and compliance regimens, professional counseling, patient advocacy and outreach, expert reimbursement services, patient training and educational services, 24/7 pharmacist access, sophisticated data management, and proactive patient call-center capabilities. The drugs being handled by Specialty Pharmacy are often quite expensive, and usually require special handling, transport and delivery (i.e. temperature-sensitive storage shipping/handling etc.). In addition, there is an increased reliance on Specialty Pharmacies to manage complicated Risk Evaluation and Mitigation (REMS) programs.

The current healthcare market often precludes Specialty Pharmacy compensation for these extra services either on differentiating reimbursement schedules, fee-for-service programs or via access to contractual pricing structures of the medications they dispense.

The good news is more and more innovative organizations understand the value of the Specialty Pharmacy channel as it continues to emerge into a distinct class of trade. Pharmaceutical R&D pipelines are robust with the development and launch of new biotech drugs, vaccines and biologics, many of which will call for the aforementioned services provided by Specialty Pharmacies. Furthermore in today’s environment of healthcare reform, appropriate prescription use, patient compliance and detailed informatics are only some of the requisites to the successful management of cost containment initiatives associated with these high-cost specialty pharmaceuticals.

In summary, the Specialty Pharmacy channel is clearly defined and well on its way to joining the ranks of other unique pharmacy providers through a universally accepted trade class distinction within the healthcare industry.


> Robert J. Irene, RPh, is President of Armada Health Care (Short Hills, NJ, tel: 866 766 4002; www.armadahealthcare.com). Armada is nation’s largest group of specialty pharmacy members and offers a host of Channel Management Solutions to the market. Armada, works closely with manufacturers and other industry partners to craft, monitor and promote custom contracting programs on a host of specialty products to these providers. Armada also organizes the industry’s largest annual specialty pharmacy business summit.

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