No Good Deed Goes Unpunished—How PBM Mandates Increase Practice Variability
Posted on May 18, 2022
Jeff Patton, MD, CEO and board member at OneOncology, dived into the controversial role that pharmacy benefit managers (PBMs) play in formulary decision marking and how PBMs impact biosimilar utilization.
In August 2019, OneOncology became one of the first to make available to practices biosimilars to replace therapies for originator therapies Avastin (bevacizumab) and Herceptin (trastuzumab), with Rituxan (rituximab) soon to follow. The decision to recommend using biosimilars instead of the originator products was made with ample efficacy and safety evidence as a commitment to cost conscious cancer care for patients, employers, and payers.
The Biosimilar Promise
Combatting the financial toxicity that impacts our patients by contributing to a real-world solution that cuts into the high-cost of health care through biosimilar utilization is what drove us to achieve a first-mover status for these agents. And today, oncologists remain on the leading edge of biosimilar market that is poised to deliver $133 billion in aggregate savings by 2025, according to a recent report from Cardinal Health.
How the PBM Playbook Increases Patient Safety Risk
As biosimilars entered the market in 2015, pharmacy benefit managers (PBMs) were slow to reimburse, but after experiencing more than 20% savings from oncologists’ early adoption of biosimilar agents in their first 2 years of use, PBMs soon employed tactics in the biosimilar market seen in originators to make money at the expense of physicians and patients.
Practices manage and navigate the outsized influence of PBMs have in oncology care on a daily basis. From prior authorization requirements to step therapy requirements to formulary restrictions, PBMs delay care, confuse patients, and impose costly mandates on practices in the pursuit of extracting fees for profit.
With biosimilars, the PBM playbook introduced unnecessary variability into practice processes—and when variability is increased—the potential for errors increases, forcing oncologists, pharmacists, and administrators to invest in additional quality-management processes to mitigate risk. It’s costly and needlessly threatens patient safety.
How Mandates Introduce Practice Variability
There are 24 commercially available biosimilars in the United States and 19 of those are for treatment or supportive care in oncology, meaning that oncology practices must stock, store, and administer 80% of FDA-approved biosimilars. This places extra mandates on the practice for identifying and segregating each drug. With similar therapies and supportive drugs in stock, the risk for look-alike and sound-alike mistakes increases, meaning the pharmacist requires additional quality-management processes to stock, store, and pull the right drug out of the refrigerator to administer it to the patient.
An examination of how PBMs manage the 5 trastuzumab biosimilars and the originator, Herceptin, sheds light on how payer practices increase costs and variability for practices and patients. Trastuzumab products are a human epidermal growth factor receptor 2 (HER2) inhibitor targeted therapy that blocks the ability of the cancer cells to receive chemical signals that tell the cells to grow.
With 6 agents available in the United States, there are multiple manufacturers and payers angling to get their preferred agent of essentially the same type of product into cancer clinics. Six payers could negotiate rebates with 6 manufacturers and mandate 6 different trastuzumab products as their preferred agent.
The oncology practice also has “no contracting power” to reduce the number of trastuzumab products and stock and administer a preferred agent to avoid look-alike and sound-alike scenarios that are confusing to the provider and increase risks for care teams and patients.
Instead of a vastly improving efficiencies and keeping cost controls top of mind by stocking 1 of 6 nearly identical agents, practices are forced into jujitsu maneuvers required to manage multiple versions of the same molecule. Why? In a word – profit.
Manufacturers pay PBMs and direct rebates for making their trastuzumab drug, in this case a biosimilar, the formulary preferred agent. The payers then mandate that physicians use this specific biosimilar. The practice is left responsible for investments to ensure, in this example, that all 6 agents are stored, handled and administered properly.
Supportive oncological drugs are another example of how PBM mandates for their preferred agent hinder practices.
Pegfilgrastim is an agent that reduces the chance of infection in some people receiving chemotherapy medications. In the United States, there are 4 biosimilar agents for the originator drug, Neulasta. Instead of implementing training and compliance programs to manage 1 supportive biosimilar for Neulasta, practices must have quality management systems in place for 4 drugs. Not because any of the agents are better or preferred by a patient, but solely because of an opaque rebate between the manufacturers and the PBM that puts money in the PBM’s pocket and ignores what the care team recommends.
After examining the PBM playbook on biosimilars, I’m left with 2 questions:
- Is there a reasonable reason a 2-physician practice should have to stock 80% of available biosimilars solely to comply with payer mandates?
- With multiple biosimilars available for a single originator, what is the PBMs motivation for dictating to the practice to use 1 biosimilar over another?
The answers to these questions prove PBMs have only 1 motivation – increasing profits off the backs of patients, employers, and oncologists.
Solution: Enhance Physician Decision Making
Physicians along with their patients, and not PBMs, need to be at the helm of health care decision making. From deciding which therapy is best to being able to receive drugs from oncologists’ in-house pharmacists, when physicians are driving decision making, care is more coordinated, patient-centric, better utilized, and ultimately less expensive.
Even with hurdles, biosimilars will create enormous value and savings in health care. Shining a light on how PBMs control biosimilars and introduce variance is yet another example of how the PBM playbook seeks to punish providers – even those who clued them into the biosimilar savings potential in the first place.
About the Author
Jeff Patton, MD, is a board-certified hematologist and oncologist, CEO and board member at OneOncology, where he also served as president of physician services for over a year. He is currently the executive chairman of the Board and served as CEO of Tennessee Oncology from 2010 to 2020. Dr. Patton is also an active member of the American Society of Clinical Oncology (ASCO), Tennessee Oncology Practice Society (TOPS), and serves as Chairman of the Community Oncology Alliance (COA). Dr. Patton is an Advisory Board member for The Center for Biosimilars®.