PhRMA highlights potential savings of outcomes-based contracts
The Pharmaceutical Research and Manufacturers of America has taken a look at the impact value-based contracts have on patient costs, and found that they deliver savings. The Washington, D.C.-based organization found that in the past two years, patients with HIV, high cholesterol and diabetes whose health plans implemented value-based contracts for their medications had 28% lower out-of-pocket costs, on average, than patients in other plans.
The organization’s report also highlights the potential for outcomes-focused contract to save costs for the broader healthcare system alongside patients. It projects that the United States could reduce healthcare spending by $12 billion a year if it can leverage outcomes-based contracts to cut diabetes spending by 5%. Part and parcel of outcomes-based contracts, PhRMA said, is a bigger financial stake from healthcare companies — which can lead to lower co-pays.
However, the report notes that PhRMA members — both manufacturers and payers — have said that barriers to widespread adoption of these contracts remain. Barriers include uncertainty regarding Food and Drug Administration rules about manufacturer communication, concern over violating the federal anti-kickback statute and worries about how contracts would effect metrics related to cost reporting.
The report notes that though these early results are promising, there’s a lot that has to be accomplished from a public policy standpoint that address PhRMA members’ concerns.
“Results-based or value-based contracts can reduce health care system costs and can make medicines more affordable and accessible for patients,” PhRMA president and CEO Stephen Ubl said. “The health care market is starting to move in this direction, but we need public policy reforms that allow greater flexibility for innovative payment arrangements that lower out-of-pocket costs and enable patients to access the right treatments the first time.”
Lupin launches generic Axiron
Lupin has introduced its generic Axiron (testosterone topical solution). The company had previously received approval from the Food and Drug Administration for the product, which is indicated for replacement therapy in males for conditions associated with deficient or absent endogenous testosterone.
Lupin’s generic Axiron will be available in a dosage strength of 30 mg per actuation. The product had a market size of $179 million for the 12 months ended December 2017, according to IQVIA data.
J M Smith shuffles tech, wholesale leadership
J M Smith is switching up the leadership its technology and wholesale business units. The Spartanburg, S.C.-based company on Monday named erstwhile chief technology officer Kevin Welch to lead its technology solutions and named Saul Factor, who was president of QS/1, to lead its Smith Drug and Burlington Drug wholesale distribution units.
“The decision to align our technology offerings under one leader was made to further enhance our customer focus. Kevin is a highly respected technology leader with a passion for moving pharmacy forward. Under his guidance, QS/1 and Integra customers can expect a commitment to technology excellence and responsiveness,” J M Smith CEO and chairman Alan Turfe said. “During his time as President of QS/1, Saul led with transparency and a contagious drive to advance customer centricity and business excellence. I am looking forward to what Kevin and Saul will accomplish for our customers in their new roles.”
Welch and Factor both joined J M Smith in 2017. Welch came on as CTO during J M Smith’s acquisition of Integra, which he founded. His experience includes time in senior positions at Genentech, Symantec and Microsoft.
“I am excited by this tremendous opportunity,” said Welch. “Aligning all our technology offerings benefits the customers in all of the markets we serve. We will continue to have dedicated teams for each of these markets – long-term care, community pharmacy and governmental, while sharing best practices across all of them.”
Factor, a pharmacist by training, joined QS/1 from his role as president of global sourcing and generics at McKesson. He spent the first 10 years of his career as a retail and long-term care pharmacist, and has worked in leadership positions at such companies as Eli Lilly and RxAmerica.
“The pharmacy industry is very dynamic and we at Smith Drug and Burlington Drug are committed to being at the forefront with innovative solutions, leading distribution processes and customer-centric service,” said Factor. “It is important to provide customers with what they need now while also working to address their future needs. I am thrilled to be leading Smith Drug and Burlington Drug with our renowned customer service and I am looking forward to partnering with customers to deliver on the promise of the pharmacy of the future.”