MedCity Influencers, Health Tech, Physicians

Specialty Pharmacy Needs a Shake Up to Help the Chronically Ill

For anyone suffering from a debilitating or life-threatening disease, the experience of procuring specialty medications is like having a second job. You are your own advocate working in a draconian system that was developed as a business, not a care service. When you’re finally successful, after what can be weeks of delays, you’re met with […]

For anyone suffering from a debilitating or life-threatening disease, the experience of procuring specialty medications is like having a second job. You are your own advocate working in a draconian system that was developed as a business, not a care service. When you’re finally successful, after what can be weeks of delays, you’re met with high costs. This is a pattern patients get used to as a result of their illness being chronic.

The prescribing of specialty medications by a physician initiates a maddeningly long and winding process that weaves through insurance companies, pharmaceutical distributors, pharmacy benefits managers (PBMs), and specialty pharmacies, all of whom are motivated to preserve their piece of the pie and control costs to generate profit. Patients can wait weeks to secure life-improving medication. Once approved, patients will then likely need to use the PBM’s mail-order pharmacy to obtain their prescriptions, further delaying the arrival of medication and initiation or continuance of treatment. After delivery, even the most minor adjustment made to a prescription can restart the process.

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A Deep-dive Into Specialty Pharma

A specialty drug is a class of prescription medications used to treat complex, chronic or rare medical conditions. Although this classification was originally intended to define the treatment of rare, also termed “orphan” diseases, affecting fewer than 200,000 people in the US, more recently, specialty drugs have emerged as the cornerstone of treatment for chronic and complex diseases such as cancer, autoimmune conditions, diabetes, hepatitis C, and HIV/AIDS.

Payers add a significant, unique layer of delays. The FDA has approved nearly 80 specialty drugs since 2021, which presents cost challenges for the health plans that pay for treatments. In response, most insurance plans incorporate a process known as utilization management to determine whether a therapy is medically necessary or appropriate. These steps, which are overseen by external PBMs, include prior authorization requirements, drug formularies, step therapy, and specialty drug tiers. This process can ultimately limit the access that patients have to a treatment, even years after a medicine has been approved by the FDA.

The desire to control costs is understandable. In the U.S., only 2 percent of the population uses specialty drugs today – but they account for 51 percent of total pharmacy spending. That’s why specialty medication has become among the largest segments of the healthcare industry, currently valued at $73.8 billion. But that’s no excuse for the slow pace of getting needed medications to sick patients.

Those living with serious, chronic ailments should not be denied their medications due to bureaucracy and process. But that is exactly what happens. It’s simply not fair to those who have jumped through hoop after hoop only to be put “on hold” by a powerful system that’s nearly impossible to effectively maneuver.

There’s a better alternative: Medically integrated dispensing (MID). Patients get better care when their prescribing doctor also dispenses their medication. Doctors who dispense can adapt treatment regimens as needed and keep costs lower for their patients. For example, when a treatment plan requires a change in dosage, the doctor can make the change and dispense immediately, reducing the amount of prescribed drugs that go to waste. Finally, care teams can keep costs lower than when patients obtain medication outside their facilities (such as through a specialty pharmacy), due to a reduction in the number of middlemen who take a profit, as medications make their way to patients.

Historically, medically integrated dispensing has only been available to larger practices with the resources and technology required to run an in-house pharmacy. Community oncology clinics have made some headway in this area, with the number of dispensing oncologists rising from 7.6% to 28.3% from 2010-2019.

Smaller clinics, as well as other specialty areas such as clinics that treat rheumatological or neurological diseases, on the other hand, have been left behind. Even those who have adopted medically integrated dispensing have been forced to manage operations using outdated software designed for pharmacies that don’t cater to the complexities of specialty drugs.

Modern technology is the final piece of the puzzle for in-house dispensing. With better technology, care teams can streamline and automate the financial and prior-authorization processes that typically hold up the delivery of speciality medications. Physicians and pharmacists log into the same platform, see the same information, and can directly plug into the EHR to access chart notes and medical records. From there, they can collect the information required by insurance companies. All of this can be done without having to go outside the clinic or navigate disparate systems.

Migrating to medically integrated dispensing ultimately means that patients are closer to their care team. Injectables can be administered under the supervision of a knowledgeable and expert caregiver, with a pharmacist guiding the patient in how to do the injection, instead of the patient doing so by themselves at home. Treatments can be discussed and quickly adjusted, as needed. Drug regimens can be more easily adhered to with ongoing support, such as counseling on therapy side effects, to help improve overall outcomes.

One could surmise that PBMs may not initially warm to the idea of in-house dispensing. But ultimately, better patient outcomes reduce costs across the board for all corners of the healthcare ecosystem. With greater access to physicians, PBMs can also work more collaboratively to prescribe effective treatments. It behooves them to get on board as well.

The healthcare industry is not generally known for expediting new processes and technologies. With the growth of specialty medications on the rise, the time is now for doctors, care teams, and specialty pharmacies alike to join forces in the interest of improving patient experiences and quality of life.

Photo: Irina_Strelnikova, Getty Images

Tesh Khullar is a healthcare technology veteran. He has spent the past 20+ years in a variety of leadership roles focused on improving the delivery of care in the specialty setting, particularly in oncology. Currently, Tesh is the Co-Founder and President of House Rx, whose mission is to make specialty medication more accessible and affordable for patients. House Rx provides services and technology support to specialty practices across the country to help clinics dispense medications directly to their patients — enabling better patient outcomes, a lower cost of care, and a better experience for both patients and their caregivers.

Previously, Tesh worked for Flatiron Health where he was one of the first executive hires and was responsible for building and scaling the company’s sales, implementation, training, and customer success functions from 2014 to 2019 as Senior Vice President of Provider Solutions. He also worked as Chief Commercial Officer at Foundation Medicine learning the genomics space and forging partnerships between the company and many community oncology organizations. Prior to Flatiron and Foundation Medicine, Tesh spent the first decade of his career in the drug distribution space (Oncology Therapeutics Network, McKesson Specialty / US Oncology) and launching multiple Group Purchasing Organizations in the specialty space (National Oncology Alliance & Onmark).

Tesh graduated from the University of California, San Diego with a BA in US History and minors in Computer Science & Engineering and Law & Society. He received his Masters in Business Administration from the University of San Francisco.

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