HEALTH

Q&A: Life after the NCPA

BY Jim Frederick

After a distinguished, eight-and-a-half-year tenure as chief of the National Community Pharmacists Association, Bruce Roberts, independent pharmacy’s toughest champion, retired June 25 as NCPA’s EVP and CEO. He now is president and CEO of Benecard Services, a small pharmacy benefit manager and prescription benefit facilitator firm founded by pharmacist Richard Ullman. Roberts, a longtime former independent pharmacy owner in Leesburg, Va., brought energy and passion to his role and helped spur a resurgence, both for the organization and independent pharmacy. Under his leadership, the NCPA gained stature as a major lobbying force on Capitol Hill, won a series of key legislative victories, reversed a membership decline, renewed interest in pharmacy ownership among pharmacy graduates and built strong collaborative ties with other pharmacy and health organizations. In an exclusive interview with Drug Store News, Roberts looked back on his years with the NCPA and shared his vision for pharmacy’s future.

Drug Store News: Now that you’ve capped this phase of your career, what are your immediate plans?

Bruce Roberts: I’m going to move back to Leesburg, Va. In my new position, I’m going to open a Washington, D.C., office and stay in the area.

DSN: Can you tell us about your new position?

Roberts: Richard [Ullman] wants to do two things: One is to create a new means to manage the prescription drug benefit that is more aligned with the beneficiary and the payer. And secondly, he’s a pharmacist, and his pitch to me is, “I want to do something to not only save the profession, but [also] really position the profession in a very favorable light in our healthcare system.”

Those have been focuses of mine from day one. As you know, I’ve been a huge critic of the PBM industry, and it probably seems very strange that I’m going over to the PBM industry. But I see it as a logical next step of my work. I came to NCPA focused on making a difference and positioning the industry in a very positive light. Benecard is a fairly small company, with about 300,000 lives and about 300 employees, so it’s an opportunity to make a difference.

DSN: How have things changed at NCPA over the years, and what do you see as the most significant accomplishments, both from the standpoint of your own satisfaction and that of NCPA and community pharmacy?

Roberts: I think we’ve made substantial gains over the last nine years. And one of the most significant gains has been fostering a rejuvenated interest in independent ownership.

When I came to the NCPA, there was very little interest in it. Independents’ numbers were dwindling, and there were very few new pharmacies opening. So that’s been a significant change, because now there’s a tremendous interest in independent ownership. We’re opening up about 100 new pharmacies a month, and NCPA’s membership is increasing about 10% a year on average.

The other thing I think where we’ve really made a difference is the increased influence of pharmacists in the political process. We have one of the largest [political action committees] in the country, and a legislative defense fund that’s second to none in pharmacy circles. And we’ve gone from a staff of basically two folks in the political communications area to…as many as 30 people focused in that area.

The NCPA also has become a very strong organization. It’s on solid financial footing, our budget’s increased dramatically, we have more than twice as many staff as when I came here and our membership, having gone through many years of decline, has shown consistent increases.

DSN: What would you like to see accomplished at NCPA over the next couple of years?

Roberts: One place where we haven’t made as many inroads as I’d like is moving to a future where the pharmacist is more an integral part of the healthcare delivery system. That’s one reason for this new gig: It’s going to give me an opportunity to build an engaged network of pharmacists, and to really shake up how the prescription drug benefit is managed. Ultimately, that’s going to be key to that future.

DSN: There’s been a sea of change in Congress’ perception of independent pharmacy. In terms of legislation, what do you see as high points over the last few years?

Roberts: We’ve had a number of wins. Things like prompt pay, inclusion of medication therapy management throughout healthcare reform, the durable medical equipment accreditation issue, the [average manufacturer price] fix [for Medicaid-paid generic drugs]. We really got more in healthcare reform than any other healthcare organization.

I’m not going to begin to take all the credit for that, but I think NCPA had a huge influence on those wins. And the reason was [that] we made a concerted effort to give independent pharmacy…a voice. We took a very methodical approach, building our [political action committee], setting up our legislative defense fund, hosting lawmakers for pharmacy visits, etc. And that has paid huge dividends and culminated in a string of legislative victories.

DSN: It’s also been an era of increasing collaboration with chain pharmacy and other groups, including those outside of pharmacy that are concerned with health issues. Will that trend continue?

Roberts: I think to have an effective trade organization, if you’re not collaborating with the rest of the folks in your industry, you’re making a huge mistake. The devils-and-angels approach doesn’t work.

DSN: Any predictions for when your successor will be found?

Roberts: I doubt there will be anybody in place before October, and it’s more likely to be the first of the year. Doug Hoey, who’s been my No. 2 for many years, is going to take the interim position. He will do a fine job running the organization, and I’ll be there to counsel him as issues arise. I’m committed to remaining active in pharmacy circles.

DSN: Do you still have a financial interest in your own pharmacy?

Roberts: No. Last August I made the decision to sell my last two stores to my employees. So I’m no longer a pharmacy owner, which after 35 years is a little strange.

DSN: If you look out five or 10 years, where would you like to see independent pharmacy?

Roberts: My vision for the industry and the profession is that pharmacists will play a highly integrated role in our healthcare system. Pharmacists will be relied on to take ownership of medication outcomes, and to work collaboratively with the rest of the healthcare team to ensure that prescription drugs are used correctly and you get the desired outcome. That’s my focus, and I have every reason to believe NCPA’s focus will remain the same.

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Sorry, FTC: ‘Pay-for-delay’ isn’t going away

BY Alaric DeArment

WHAT IT MEANS AND WHY IT’S IMPORTANT This week’s decision by the U.S. Second Circuit Court of Appeals could make political efforts to ban generic-branded patent settlements a lot more difficult.

(THE NEWS: Appeals court upholds decision to OK ‘pay-for-delay’ deals. For the full story, click here)

The Federal Trade Commission in particular, not to mention some members of Congress like Sen. Herb Kohl, D-Wis., has fought hard against so-called “pay-for-delay” settlements between branded and generic drug companies, contending that they delay patients’ access to generic drugs and cost consumers billions of dollars every year.

The concerns of opponents are understandable. Because generic and branded drug makers are supposed to be competitors, what seem on the surface like sweetheart deals must look positively Faustian to many people. But the judges in the appeals court affirmed that whatever their appearance, patent settlements don’t violate antitrust laws.

And the facts seem to support that decision. According to a report released in January by RBC Capital Markets, generic drug companies prevailed in 76% of cases that included settlements, but only in 48% of cases that went to trial. Meanwhile, according to a report released the same month by securities and investment banking firm Jefferies & Co., on average, patent settlements result in generic launch three years before patent expiration. Legally, a generic drug company must launch its version of a drug before or at the time of patent expiration.

While patent settlements often involve some type of monetary transaction, in many cases, the “pay” is in the form of a promise by the branded drug company not to launch an authorized generic, which is the branded drug sold under its generic name at a lower price. Under the Hatch-Waxman Act, the first generic drug maker to launch a knockoff of a branded drug is entitled to six months in which to compete directly with the branded version, but the authorized generic allows the branded drug maker to undercut the generic drug maker by marketing a supposedly “generic” version of its own.

Authorized generics have seen a bit of a pickup as well, and more activity on that front can be expected. On Tuesday, Greenstone, the generics arm of Pfizer, announced that it would create a new business called the Authorized Generics Alliance in order to market authorized generics under the Greenstone label.

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Medicaid plans to end onerous AMP rules

BY Jim Frederick

WHAT IT MEANS AND WHY IT’S IMPORTANT It’s about time.

(THE NEWS: NACDS, NCPA in joint statement praise CMS’ move to withdraw provisions of AMP rule currently blocked by injunction. For the full story, click here)

The White House, or more specifically the Centers for Medicare and Medicaid Services’ division of Health and Human Services, announced in recent days that it plans at last to scrap its controversial and burdensome pricing policies for generic drugs bought by retail pharmacies to dispense to Medicaid patients. If CMS’ newly proposed rule goes through, it will mean the end of the current, much-disputed provisions that define the average manufacturer price of Medicaid me-too medicines.

The proposed rule, to quote the National Association of Chain Drug Stores, calls for “the withdrawal of existing provisions that define AMP, that determine the calculation of federal upper limits [FULs], and that define ‘multiple source drug.’”

As currently defined, Medicaid’s payment model for reimbursing pharmacists to dispense generics is based on a flawed formula for determining what retail pharmacies pay for those medicines, as determined by a set of controversial market metrics.

The current AMP policy almost is a guarantee that retail pharmacies would lose money on nearly every Medicaid generic prescription they dispense. It’s only a temporary court injunction that has thus far kept that new formula from being imposed.

Thus, CMS’ turnabout marks a real victory for the chain and independent pharmacy lobby, which has bitterly contested the AMP reimbursement formula since it was made policy by the Bush administration more than three years ago. But the plan to withdraw the current AMP model doesn’t end the long battle by pharmacy for a fair payment policy for dispensing generic drugs to Medicaid beneficiaries.

What the pharmacy industry –– and the U.S. healthcare system itself, for that matter –– need is a permanent solution to the Medicaid reimbursement mess. And that solution can only be achieved by congressional action and enactment of a new law governing Medicaid.

The 2010 health-reform law goes part way toward that solution, by holding the line on pharmacy cuts and setting the FULs on Medicaid prescription payments at no less than 175% of cost. It also includes what NACDS president and CEO Steve Anderson calls “a much-improved definition and calculation method for AMP” that will “better approximate pharmacies’ costs for purchasing generic drugs.”

Anderson said the injunction lawsuit filed in 2007 by NACDS and its independent pharmacy counterpart, the National Community Pharmacists Association, has saved pharmacy more than $5.3 billion in cuts since a federal court blocked the imposition of the new AMP formula in January 2008. It also may have prevented the closing of more than 11,000 community pharmacies that otherwise would have been forced to dispense Medicaid scripts at a loss or stop serving lower-income patients.

“When we filed the lawsuit in 2007, we knew that patient care was at stake,” Anderson asserted.

The bottom line is that the White House and Congress need to establish a federal payment system that rewards –– rather than penalizes –– pharmacies for dispensing lower-cost generics that provide the same safety and efficacy profiles as higher-cost pioneer medicines. Such a permanent fix would be a win both for the pharmacy industry and the American taxpayer, by saving tens or even hundreds of billions of dollars over the long term in federal health costs.

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