Q4 2019 Excelsior Newsletter

HIV PrEP Therapies

by Darian Hurst, Vice President

In June 2019, the United States Preventive Services Task Force (USPSTF) published a final recommendation that clinicians offer preexposure prophylaxis (PrEP) with effective antiretroviral therapy to persons who are at high risk of HIV acquisition. HIV PrEP is when people at high risk for HIV take medicine daily to lower their chances of getting infected with HIV. The Centers of Disease Control and Prevention (CDC) has estimated that approximately 1.2 million people are at high risk for HIV exposure and could benefit from comprehensive HIV prevention strategies, including HIV PrEP.

At least 381,580 people have started to take HIV PrEP therapy in 68 countries, but 59% of HIV PrEP users are in North America, according to a global analysis conducted by AVAC and the Clinton Health Access Initiative.

Effective July 1, 2020, or their next anniversary date, all non-grandfathered self-insured plan sponsors are required to incorporate HIV PrEP coverage at zero cost-share under ACA regulations. For those clients whose anniversary is after July 1, 2020, this change would take effect on the anniversary date. A majority of employers’ anniversary date is January 1st, consequently they will not have to implement this change until January 1, 2021.

On October 3, the United States Food and Drug Administration (FDA) approved Descovy (emtricitabine 200 mg/tenofovir alafenamide 25 mg) for HIV-1 PrEP to reduce the risk of HIV-1 infection. Descovy joins Truvada (emtricitabine 200 mg/tenofovir disoproxil fumarate 300 mg) which is another HIV PrEP medication, Truvada has been on the market since 2012. The current monthly AWP cost of both medications is $1,807. Truvada is expected to go generic in Q42020, as such, Excelsior recommends that the generic Truvada be the placed as the first line of therapy upon its generic launch. Covering the generic version satisfies the ACA requirement and you do not have to cover the brand at $0 copay. It is important to keep in mind that since these medications can be used for treatment and not just prevention, all carriers and PBMs will require the members’ physician to contact their clinical unit(s) to determine if the clinical criteria are satisfied (on a case by case basis).

As more members may take PrEP and there will be no member cost share you can expect spend to increase in this area. The generic program is your best option to mitigate the increased cost.

Darian Hurst
Vice President

Darian joined Lockton in 2013. For the past 10 years, he has built and maintained strong industry relationships and ensures that Lockton and its clients are informed of current and emerging issues within the industry.

Darian identifies pharmacy saving s opportunities with clients and prospects. He also coordinates contract negotiations with carriers and pharmacy benefit manager s to develop effective client benefit strategies and engagements, including implementation support and ongoing pharmacy consulting support.

Medical Rebate Strategies

Every employer at this point is aware of the significant amount of money that is available to them through rebates on the pharmacy benefit, whether these rebates are applied to their ASO fees, applied to claim costs at the point of sale, paid directly to the plan or some hybrid of these options. However, did you know that there may be opportunity to receive rebates on pharmaceutical claims through your medical benefit? PBM rebates are paid by manufacturers in classes where competition exists for the preference of their drug over the competition. In much the same way, rebates are paid by manufacturers for drugs filled through the medical benefit based on preference for competition.

Claim Cost Management Strategies

Just like PBM rebates, medical rebates should be considered as an integral part of claim cost management strategies but not at the expense of higher claim cost. In much the same way as a generics first strategy should be considered for traditional drugs through the PBM benefit, biosimilars and follow- on biologics can reduce overall claim costs by 15-33%. Many Payors have implemented this sort of rule in classes like autoimmune (Remicade and its biosimilars Renflexis and Inflectra) and oncology supportive care (Neulasta and its biosimilar Fulphila).

However, when rebates are available, it is important to determine whether a rebate could create the lowest net cost option for a class. Most commercial/exchange plans realize $3-5 PMPY in total medical rebates. There are two major categories for which Medical Rebates are paid.

  • “Commoditized Brand Drugs” with at least two, and more often three or more, competing products in the market basket. Examples include Intrauterine Devices (IUD’s), autoimmune (IVIG), and viscosupplements (arthritis of the knee). The latter category has grown to having over a dozen products, prompting manufacturers to offer material rebates on the
  • Follow-on Biologics/Biosimilars: The most likely time to expect a biosimilar or follow-on biologic drug to provide rebates is when there are three competing products in the market basket (i.e., the branded drug and two biosimilars). Examples in this category are Zaria and Nivestym or Renflexis and

How can Self-Insured Employers benefit?

Most large carriers are taking advantage of medical rebates on behalf of their self-funded clients, but how is the employer benefiting from these rebates and biosimilars. We recommend employers take the following actions:

  1. Review your ASO contract to determine whether your carrier is collecting medical rebates on your behalf and, if so, what happens to
    1. If this language does not exist, inquire with your carrier regarding the full pass-through of these
    2. If this language does exist, require that reporting of the medical rebates be provided to ensure that you are getting the full value of the rebates, whether through program credit or invoice credit.
  2. Demand that your carrier implements biosimilar-first medical polices for your

Greg Bigwood
Vice President

Gregory possesses more than 15 years of diverse health care experience. Having spent several years in PBM finance and underwriting, his deep understanding of PBM financials and operations ensures chat his clients receive and maintain significant financial savings backed by unparalleled levels of service.

Gregory delivers expertise in contract negotiation, RFP management and ongoing consultation with clients. He has been a featured national speaker on topics such as specialty drugs, RFP management, PBM pricing, Medicare Part D compliance, and PBM audit (both Medicare and non-Medicare).

Update on PBM & Carrier Opioid Management Programs

By Robert Kordella, R.Ph., MBA, Chief Clinical Officer

According to the Centers for Disease Control & Prevention (“CDC”) more than 11.5 million people reported misuse of prescription pain medicine in 2016. The CDC has developed several guidelines for prescribing opioids to help prevent addiction and misuse while getting patients the care they need. In response to the opioid epidemic and the CDC guidelines, PBMs & Carriers started implementing programs to assist clients and patients. We recently reviewed the major PBMs’ and Carriers’ opioid management programs to better understand their offerings and see if advancements were being made. There are generally six things that all of these programs have in common:

  1. A strong reliance (to some extent or another) on the CDC prescribing guidelines, meaning that the focus is on managing/limiting Rxs that have already been written, as opposed to changing the choice of pain management drug category (for instance, to an NSAID or topical agent), or the choice of treatment modality (for example, to acupuncture, massage, or chiropractic treatment.) We would expect those PBMs that have corporate relationships with major insurance carriers to be both more aggressive and more effective in this area, but, by-and-large, that potential for differentiation has yet to be realized among those PBMs.
  2. A strong reliance on quantitative reductions in the number of opioid Rxs, and in the number of units per Rx, as the predominant metric of program success.
  3. Less of a commitment than we’d like to see to physician education about using treatments other than opioids for the treatment of chronic pain.
  4. Few metrics about conversion from opioid- to non-opioid- treatments for chronic pain management.
  5. Not much discussion about dealing with, or even identifying, already-addicted patients, aside from the occasional mention of formulary changes to support Medication-Assisted Treatment (“MAT”), to assist in weaning already opioid-addicted off of opioids. This another area in which we would expect the larger, carrier-based entities to assert some leadership, but it, too, has been slow in materializing.
  6. Not as strong a commitment as we’d like to see from all players to getting unused opioid Rxs out of homes once the need for their use has passed. (Certain PBMs/Carriers that own/operate retail pharmacies tend to do a better job at this task than those that do not.)

This assessment causes us to reflect on a certain reality, and that is if the CDC Guidelines are now entrenched as the “standard of care,” and if those Guidelines form the primary core of all/most PBM/Carrier opioid management programs, why is there an ancillary charge being added for such basic services? There is no reasonable justification for Clients to be asked to pay extra for what now constitutes table stakes.

Unfortunately, our recent canvassing of the major PBMs also revealed that with one notable exception, most of the major PBMs and Carriers have elected to continue to charge incremental fees ranging from pennies PMPM to amounts ranging between $0.25 and $0.40 PMPM for opioid management services. The fee can vary depending on client size.

Our hope is that PBMs’ quantitative improvements to-date will continue to bear fruit, while their qualitative improvements in standards of practice will begin to accelerate in the near future, as fees for basic opioid management services are successfully negotiated away.

Robert Kordella,
R.Ph., MBA Chief Clinical Officer

Bob has more than 30 years of diverse experience in the pharmacy industry. Over the course of his career, Bob has led clinical and PBM operations teams in successfully managing more than $4 billion in annual drug spend. This was also while limiting per- member-per-year spending growth to levels that have simultaneously drawn industry acclaim and consistently high levels of member and payer satisfaction.

More related articles

More Articles