PBM giants cut drug expenses

September 10, 2016

When Express Scripts and CVS Health announced their 2017 formularies on August 1, a common theme emerged among the healthcare giants: several blockbuster drugs will be removed from both companies’ formularies and lower-cost options such as biosimilars are being embraced.

When Express Scripts and CVS Health announced their 2017 formularies on August 1, a common theme emerged among the healthcare giants: several blockbuster drugs will be removed from both companies’ formularies and lower-cost options such as biosimilars are being embraced.

Express Scripts’ will exclude 85 medications from its National Preferred Formulary in 2017. Newly excluded drugs include Orencia (Bristol-Myers Squibb) for arthritis, Taltz (Eli Lilly) for psoriasis and Zyclara (Valeant), a skin cream for actinic keratoses.

“Participating plan sponsors will save approximately $1.8 billion throughout the year, the biggest annual savings since the NPF was introduced in 2014,” Express Scripts said on its web site.

Likewise, CVS Health said it is removing medications with “hyperinflationary” costs from its 2017 formulary and set forth a plan to control the costs of hepatitis C drugs and other medications. It will remove 35 drugs from its standard formulary in 2017, including 10 hyperinflationary drugs.

“CVS Health is taking a stand against egregious drug price increases that unnecessarily add costs for clients and their members. On a quarterly basis, products with egregious cost inflation that have readily-available, clinically-appropriate and more cost-effective alternatives may be evaluated and potentially removed from the formulary,” the company said on its web site.

Among the hyperinflationary drugs that will be removed by CVS in 2017 is Alcortin A External Gel (Novum Pharmaceuticals) which had price inflation of 2856.8% in the last 3 years. Other drugs to be removed include the beta blocker Dutoprol, Carnitor SF Oral Solution (Sigma-Tau Pharmaceuticals) and the corticosteroid DexPak oral tablets.

 

Biosimilar and follow-on biologics will be included as a key component of CVS Health’s 2017 standard formulary strategy, replacing higher cost drugs within the categories. To that end, Zarxio (Sandoz) will replace Neupogen (Amgen) to treat infections after cancer treatments and Basaglar (Boehringer Ingelheim), approved as a biosimilar in Europe, will replace the insulin Lantus (Sanofi-Aventis) for diabetes.

“We anticipate significant savings for many clients and members, as the removal of higher cost products will enable near-term value, with additional future opportunities for savings resulting from market competition as more new products are launched,” CVS Health said.

Meanwhile, while Harvoni and Epclusa (Gilead Sciences) are on Express Scripts’ 2016 excluded medications list, that may change in 2017. Express Scripts is expected to make an announcement on the two medications later this year.

In addition, some drugs that Express Scripts excluded in 2016 will be added to its 2017 formulary. They include arthritis drugs Xeljanz and Xeljanz XR (Pfizer) and Arnuity Ellipta and Flovent Diskus (GlaxoSmithKline) asthma treatments. After price negotiations with the manufacturers, those drugs will be considered “preferred alternatives.”

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