Value-Based Insurance Design Improves Medication Adherence Without An Increase In Total Health Care Spending.

Value-based insurance design (VBID) is a strategy that reduces cost sharing for high-value services and increases consumers' out-of-pocket spending for low-value care. VBID has increasingly been implemented by private and public payers and has inspired demonstration programs in Medicare Advantage and TRICARE. Given the recent publication of several studies, we performed an updated systematic review that evaluated the effects of reducing consumer cost sharing on medication adherence and other relevant outcomes. Searches were conducted in key online databases, and the screening of citations yielded twenty-one unique studies, of which eight had not been included in previous reviews. Using the Grading of Recommendations, Assessment, Development and Evaluation (GRADE) system, we found moderate-quality evidence showing improvement (range: 0.1-14.3 percent) in medication adherence with VBID. This increase in adherence was associated with no effect on total health care spending, which suggests that the incremental drug spending was offset by decreases in spending for other health care services.

Influence of drug class and healthcare setting on systemic antifungal expenditures in the United States, 2005-15.

PURPOSE: Overall and specific class trends in systemic antifungal expenditures in various U.S. healthcare settings from 2005 through 2015 were evaluated. METHODS: Systemic antifungal expenditures from January 1, 2005, through December 31, 2015, were obtained from the QuintilesIMS National Sales Perspective database, which provides a statistically valid projection of medication purchases from multiple markets throughout the United States. Summary data for total antifungal expenditures over the entire period are reported, as are growth and the percentage change in expenditures from one year to the next. Expenditures were also assessed specifically by year, class, and healthcare setting. Expenditure trends over the study period were assessed using simple linear trend regression models. RESULTS: Overall expenditures for the 11-year period were $9.37 billion. The greatest proportion of expenditures occurred in nonfederal hospitals (47.2%) and for triazoles (57.6%). From 2005 through 2015, total expenditures decreased from $1.1 billion to $894 million (-18.8%, p = 0.09); however, expenditures in clinics and retail pharmacies increased (202%, p < 0.01, and 13.8%, p = 0.04, respectively), a trend most pronounced after 2012. Expenditures for flucytosine also increased (968.1%, p < 0.01), particularly in clinics where there was a dramatic 6,640.9% increase (p < 0.01). CONCLUSION: From 2005 through 2015, an increase in systemic antifungal expenditures was observed in community settings, despite an overall decrease in total antifungal expenditures in the United States. Large increases in flucytosine expenditures were observed, particularly in the community.

Fixed-dose combination and single active ingredient drugs: a comparative cost analysis.

BACKGROUND: Fixed-dose combination (FDC) drugs are formulations of two or more active ingredients. OBJECTIVES: To assess the pricing structure and price difference of all US FDA-approved FDCs and single drugs included in the combination. METHODS: Data were collected from the FDA Orange Book and Drugs@FDA. Average Wholesale Price (AWP) unit price data were derived from The Red Book. RESULTS: The FDA approved 117 FDC. The average AWP difference percentage between the FDC and the sum of the single drugs in the FDC is 84.9 ± 26.2%, and varied by therapeutic class (p < 0.001). The FDC AWP averaged 83.3 ± 23.4% of the single drug AWP sum when there are no generics, and 95.1 ± 42.3% (p < 0.01) when there are two generic single active ingredients in the FDC. CONCLUSIONS: The price difference between FDC and single active ingredients in the combination is correlated with the therapeutic class, the year of FDC approval, and the number of single ingredients in the combination that have generics.

Biopharmaceutics classification system: importance and inclusion in biowaiver guidance

Pharmacological therapy is essential in many diseases treatment and it is important that the medicine policy is intended to offering safe and effective treatment with affordable price to the population. One way to achieve this is through biowaiver, defined as the replacement of in vivo bioequivalence studies by in vitro studies. For biowaiver of new immediate release solid oral dosage forms, data such as intestinal permeability and solubility of the drug are required, as well as the product dissolution. The Biopharmaceutics Classification System (BCS) is a scientific scheme that divides drugs according to their solubility and permeability and has been used by various guides as a criterion for biowaiver. This paper evaluates biowaiver application, addressing the general concepts and parameters used by BCS, making a historical account of its use, the requirements pertaining to the current legislation, the benefits and risks associated with this decision. The results revealed that the use of BCS as a biowaiver criterion greatly expands the therapeutics options, contributing to greater therapy access of the general population with drug efficacy and safety guaranteed associated to low cost.

O tratamento farmacológico é essencial frente a várias patologias e é fundamental que a política de medicamentos tenha por objetivo oferecer à população tratamento seguro, eficaz e de preço acessível. Uma forma de alcançar esse objetivo é por meio da bioisenção, definida como a substituição de estudos de bioequivalência in vivo por estudos in vitro. Para bioisentar novos medicamentos sob a forma farmacêutica sólida oral de liberação imediata são utilizados dados de permeabilidade intestinal e solubilidade do fármaco, bem como sua dissolução a partir da forma farmacêutica. O Sistema de Classificação Biofarmacêutica (SCB) é um esquema científico que divide os fármacos em classes de acordo com a solubilidade e permeabilidade e vem sendo utilizado como critério para bioisenção em diversas legislações. O presente artigo faz uma avaliação da aplicação da bioisenção, abordando os conceitos gerais e parâmetros utilizados pelo SCB, fazendo um relato histórico da aplicação da bioisenção, das exigências pertinentes às legislações vigentes, dos benefícios e riscos inerentes a uma tomada de decisão sobre bioisenção baseada neste critério. Os resultados revelaram que a utilização do SCB como critério amplia enormemente as possibilidades de bioisenção, contribuindo para o maior acesso da população em geral a medicamentos com garantida eficácia, segurança e menor custo.

International prices and availability of pharmaceuticals in 2005.

This paper compares pharmaceutical spending, availability, use, and prices in twelve countries in 2005. Drug spending per capita was higher in the United States than in other countries. The United States had relatively high use of new drugs and high-strength formulations; other countries used more of older drugs and weaker formulations. Thus, whether U.S. overall volume of use is lower or higher depends on the measure of volume and type of product. Comprehensive price indexes show foreign prices to be 20-40 percent lower than U.S. manufacturer prices, but only 10-30 percent lower than U.S. public prices. Generics are cheaper in the United States than in other countries.

What's in a name? Use of brand versus generic drug names in United States outpatient practice.

BACKGROUND: The use of brand rather than generic names for medications can increase health care costs. However, little is known at a national level about how often physicians refer to drugs using their brand or generic names. OBJECTIVE: To evaluate how often physicians refer to drugs using brand or generic terminology. DESIGN AND PARTICIPANTS: We used data from the 2003 National Ambulatory Medical Care Survey (NAMCS), a nationally representative survey of 25,288 community-based outpatient visits in the United States. After each visit, patient medications were recorded on a survey encounter form by the treating physician or transcribed from office notes. MEASUREMENTS: Our main outcome measure was the frequency with which medications were recorded on the encounter form using their brand or generic names. RESULTS: For 20 commonly used drugs, the median frequency of brand name use was 98% (interquartile range, 81-100%). Among 12 medications with no generic competition at the time of the survey, the median frequency of brand name use was 100% (range 92-100%). Among 8 medications with generic competition at the time of the survey ("multisource" drugs), the median frequency of brand name use was 79% (range 0-98%; P < .001 for difference between drugs with and without generic competition). CONCLUSIONS: Physicians refer to most medications by their brand names, including drugs with generic formulations. This may lead to higher health care costs by promoting the use of brand-name products when generic alternatives are available.

Medicaid prescription drug spending in the 1990s: a decade of change.

Medicaid spending increased dramatically during the 1990s, driven in part by spending for prescription drugs. From 1990 to 2000, Medicaid drug spending increased from $4.4 billion to over $20 billion, an average annual increase of 16.3 percent. Disabled persons experienced an even greater 20 percent average annual increase. By drug category in 1997 (for 29 States), the highest spending amount was for central nervous system (CNS) drugs, accounting for 17 percent of total Medicaid drug spending. These findings provide information on drug spending for dually eligible beneficiaries to policymakers as they seek to target cost-effective coverage and drug therapies.

Reference-based pricing schemes: effect on pharmaceutical expenditure, resource utilisation and health outcomes.

Pharmaceutical expenditure is rising more rapidly than the general inflation rate in most advanced countries. One strategy that has been introduced to control pharmaceutical costs is reference-based pricing (RBP). Its potential is restricted to those specific segments of the drug market where several drugs (and/or their generic forms) exist without substantial evidence that any particular agent is superior. Three broad approaches have been adopted. These involve the aggregation of drugs into generic groups, related drug groups (e.g. ACE inhibitors) or drugs grouped by therapeutic indication (e.g. antihypertensives). For each drug group, a single reimbursement level or reference price is set. Drugs above the reference price require part or total payment by the patient. The experience with RBP ranges from over 10 years in Germany (involving all levels of RBP) to the more recent implementation of RBP for related drug groups in Australia. This review summarises the current state of knowledge on RBP from the published experiences in the countries where RBP has been adopted. The published systematic reviews of RBP from the countries that have implemented it suggest that RBP has been successful at temporarily capping drug prices for the RBP drug groups and achieving short term cost savings. However, other factors influencing total pharmaceutical expenditure have often occurred simultaneously and make it difficult to isolate specific effects of RBP. Further investigation is required before any valid conclusions can be drawn about the net effect of RBP on healthcare costs. RBP has withstood the initial legal challenges of pharmaceutical companies and the criticisms of some clinicians. Where the reference price is based on the lowest priced drug(s) in the group, RBP appears to be one of the few strategies likely to be effective at encouraging doctors to use the least expensive agents as first-line therapy and utilise more expensive agents in those who experience side effects or poor efficacy.

Modelling strategies for reducing pharmaceutical costs in hospital.

OBJECTIVE: To describe drug utilization and cost in a large hospital and to compare the impact of different strategies on cost associated with drug prescribing. DESIGN: Retrospective data on drug utilization and cost, linked to patient clinical data and prescriber data from November 1998 were analyzed and modelled. MAIN OUTCOME MEASURES: Impact of different strategies for cost control. SETTING: A large hospital in Sydney, Australia. RESULTS: The mean cost of drugs per episode of care was 28 Australian dollars. Of all drug costs, 79% was incurred by medical units and 14% by surgical units. Oncology accounted for 42% and inpatients for 91% of drug costs. Although section-100 (S-100) drugs incurred a high cost (640 dollars) per episode of care, there were only 41 episodes where S-100 drugs (expensive, restricted drugs) were used, and the total cost of S-100 drugs was only 3.7% of the total cost to the hospital. Antibiotics were the most commonly prescribed drug category, prescribed in 14% of all hospital episodes, and accounting for 14% of total drug costs. Anti-ulcer drugs were the next most costly group, accounting for 7% of total drug costs. A 20% reduction in use of antibiotics would save four times that (233,832 dollars pa) of a 20% reduction in use of S-100 drugs (61,392 dollars pa). DISCUSSION: Our study suggests that reducing inappropriate use of high volume drugs such as antibiotics could be more effective in optimising health facility drug budgets than attempts concentrating solely on reducing use of high cost drugs alone. Moreover our study suggests that systematic measurement of drug utilisation patterns is a key element of drug cost control strategies.

Drug expenditure in hospitals: what do German ward physicians know?

AIMS: Ward physicians hold key positions in the course of efforts to reduce drug expenditures in hospitals. This study evaluated the knowledge of German hospital physicians with respect to the daily therapeutic costs of 21 frequently used drugs. METHODS: A questionnaire survey was carried out among 168 ward physicians from university and municipal hospital departments of internal medicine. RESULTS: One hundred and twenty-seven physicians returned a completed questionnaire, a response rate of 75.6%. On average the physicians successfully identified both low cost and expensive drugs. The prices of inexpensive and moderately expensive drugs were generally overestimated whereas those for the expensive and highly expensive drugs were underestimated in 35% and 68% of respondents, respectively. CONCLUSIONS: The results of this survey of German hospital physicians suggest that a more economically efficient use of drugs could be achieved by an improved knowledge of daily therapeutic costs.

Prescription drug prices: why do some pay more than others do?

The fact that sick elderly people without prescription drug coverage pay far more for drugs than do people with private health insurance has created a call for state and federal governments to take action. Antitrust cases have been launched, state price control legislation has been enacted, and proposals for expansion of Medicare have been offered in response to price and spending levels for prescription drugs. This paper offers an analysis aimed at understanding pricing patterns of brand-name prescription drugs. I focus on the basic economic forces that enable differential pricing of products to exist and show how features of the prescription drug market promote such phenomena. The analysis directs policy attention toward how purchasing practices can be changed to better represent groups that pay the most and are most disadvantaged.

Pharmaceutical cost-containment policy: experiences in Shanghai, China.

BACKGROUND: In the decade after 1983, the annual growth rate of drug expenditure was about four times as high as that of per capita gross domestic product (GDP) in Shanghai. In 1993 and 1994, a drug list policy and hospital revenue capping policy were introduced in Shanghai to contain drug expenditure. We studied the impact of these two policies, as a model for similar policies in other parts of China and elsewhere. METHODS: Quarterly drug expenditure data were collected from 1992 to 1996 and more detailed drug expenditure flow was obtained at seven selected hospitals. Twelve focus group discussions were organized to obtain opinions from all stakeholders. RESULTS: The research findings showed a dramatic and continuing decline in the growth rates of total medical and drug expenditures after the implementation of the two policies. The proportion of total medical expenditure attributable to drugs declined from 67% in 1992 to 51% in 1996. The annual growth rate of drug expenditure per ambulatory visit and per bed-day was reduced as well. Drug revenue as a proportion of total hospital revenue declined gradually in all seven hospitals. The two policies did not alter the equity of drug utilization between the insured and non-insured. The government, insurance authority and state-owned drug enterprises all favoured the new policies, while hospital administrators, professionals, joint venture and foreign manufacturers wished for the reimbursement mechanisms to be improved, for retention of their freedom of choice, and for the drug list to be further expanded. CONCLUSIONS: The drug list and capping policies in Shanghai appear to have achieved their objectives of containing the escalation of drug expenditure and improving the rational use of drugs without loss of equity. The underlying causes of the escalation of drug expenditure in China need to be further elucidated.

Changes in 1994 drug cost for inpatient services.

The healthcare system is undergoing major changes in the manner in which healthcare is being delivered. These changes have affected individual institutions per se, as well as having an affect upon the cost of the drugs being administered. The comparative indices for the years 1993 and 1994 indicate that the utilization and classes of drugs being prescribed are undergoing change. Although drug cost has not increased to the same magnitude as in the past, it continues to show significant growth. Of continuing importance is the changes taking place in the classifications of drugs being used and the affect that these changes have on cost.

What does the Consumer Price Index for prescription drugs really measure?

This article examines the conceptually desirable attributes of a fully quality-adjusted prescription drug price index. It provides an understanding of how the Consumer Price Index for prescription drugs and medical supplies treats quality changes in prescription drugs and, in particular, quality changes associated with the introduction of new drugs.