With specialty drug costs going through the roof, the industry is trying a creative solution
Benefits providers are going straight to the source in a bid to control escalating speciality cost drugs.
“We’re creating more strategic partnerships with the pharmaceutical companies directly, focussed in part on pricing but also on appropriate use so when the drugs are used we’re ensuring our members get value for money,” said Chris Goguen, Strategic Pharmaceutical Partnerships Lead at Medavie Blue Cross.
Medavie Blue Cross is the latest example of a major insurer working on enhancing its relationships with a pharmaceutical company in an attempt to curb drug costs.
“We think it allows us to more efficiently manage the drug budget if you will,” said Goguen. “By not only realizing savings in the cost of medicines but also when the dollars are invested in them they’re in the right patient at the right time. It gives us that better balance between the member’s needs, the therapies combined with the ability to afford continued investment.”
It’s a problem that’s only getting worse. Over a five-year period (2008 - 2013), IMS Brogan reported that biologic and specialty drug costs by pay-direct private drug plans in Canada grew from approximately 12 per cent of total drug spending to approximately 21 per cent of total drug spending ($1.3 billion). Goguen said it’s now reached a total of 25% at Medavie.
“The challenge for private plans right now is really the area of managing high cost drugs,” he said. “It’s never been more important as the specialty drug landscape is changing. The pipeline for the proliferation and development of specialty drugs has never been greater. It presents an important challenge for carriers but also plan sponsors and it means we need to continue to find new strategies and new approaches to keep plans private plans sustainable again, especially as it related to the specialty high cost medicines.”
Advisors are vital in the fight.
“Advisors can direct members towards these innovative plan design strategies,” Goguen said. “We honestly feel that the nature of modern benefits design is more hands on active drug plan management, including prior authorization – enhanced and integrated into services – as well as reinforcing the need to create strategic relationships, partnerships in the system with pharmacies as well as pharmaceutical companies.”
The Angus Reid Institute and Mindset Foundation surveyed 1,556 Canadians in early July about drug costs in Canada, and found that 91 per cent of Canadians want a national pharmacare program to go along with the provincial healthcare plans that already exist – which places insurers in the catbird seat to be an advocate for clients in keeping costs in check.
“We’re creating more strategic partnerships with the pharmaceutical companies directly, focussed in part on pricing but also on appropriate use so when the drugs are used we’re ensuring our members get value for money,” said Chris Goguen, Strategic Pharmaceutical Partnerships Lead at Medavie Blue Cross.
Medavie Blue Cross is the latest example of a major insurer working on enhancing its relationships with a pharmaceutical company in an attempt to curb drug costs.
“We think it allows us to more efficiently manage the drug budget if you will,” said Goguen. “By not only realizing savings in the cost of medicines but also when the dollars are invested in them they’re in the right patient at the right time. It gives us that better balance between the member’s needs, the therapies combined with the ability to afford continued investment.”
It’s a problem that’s only getting worse. Over a five-year period (2008 - 2013), IMS Brogan reported that biologic and specialty drug costs by pay-direct private drug plans in Canada grew from approximately 12 per cent of total drug spending to approximately 21 per cent of total drug spending ($1.3 billion). Goguen said it’s now reached a total of 25% at Medavie.
“The challenge for private plans right now is really the area of managing high cost drugs,” he said. “It’s never been more important as the specialty drug landscape is changing. The pipeline for the proliferation and development of specialty drugs has never been greater. It presents an important challenge for carriers but also plan sponsors and it means we need to continue to find new strategies and new approaches to keep plans private plans sustainable again, especially as it related to the specialty high cost medicines.”
Advisors are vital in the fight.
“Advisors can direct members towards these innovative plan design strategies,” Goguen said. “We honestly feel that the nature of modern benefits design is more hands on active drug plan management, including prior authorization – enhanced and integrated into services – as well as reinforcing the need to create strategic relationships, partnerships in the system with pharmacies as well as pharmaceutical companies.”
The Angus Reid Institute and Mindset Foundation surveyed 1,556 Canadians in early July about drug costs in Canada, and found that 91 per cent of Canadians want a national pharmacare program to go along with the provincial healthcare plans that already exist – which places insurers in the catbird seat to be an advocate for clients in keeping costs in check.
