AHIP published a report examining the price mark-ups of 10 drugs that can be delivered more cheaply by specialty pharmacies, including 3 drugs with multiple biosimilars available.
According to a new report from AHIP, drugs dispensed in a hospital or doctor’s office can cost up to twice as much as the same drugs dispensed in specialty pharmacies.
Researchers analyzed the cost of 10 drugs that are purchased, stored and administered in a hospital office or doctor’s office, but can also be delivered safely through a specialty pharmacy. Among the 10 drugs evaluated, 3 have several biosimilars available.
On average, drugs dispensed in doctors’ offices cost $1,400 more, and the cost per single treatment in hospitals averaged $7,000 more than those purchased in specialty pharmacies. Hospitals charged, on average, 108% higher prices for the same drugs than specialty pharmacies, and doctors’ offices charged 22% higher.
It should be noted that the cost estimate for drugs in doctors’ offices and hospitals did not include the cost of administering the drugs. Additionally, while mark-up amounts were estimated for a single treatment, all 10 drugs assessed require multiple treatments.
“Specialty pharmacies reduce a patient’s healthcare costs by preventing hospitals and physicians from charging exorbitant fees to purchase and stock specialty medications themselves,” the authors write in the report. “Direct and secure delivery is more efficient and effective and reduces healthcare costs.”
Researchers identified the 10 drugs evaluated using the list of top 25 drugs by spending in Medicare Part B in 2019, as well as consulting AHIP member plans on drugs commonly dispensed by specialty pharmacies. . They used medical and pharmaceutical claims data from the IBM MarketScan commercial database from January 1, 2018 to December 31, 2020 and calculated the average cost over 3 years for a single treatment for each of the 3 parameters.
The 3 drugs examined with the biosimilars were:
- Herceptin (trastuzumab, Genentech), which has 5 biosimilars available in the United States
- Kanjinti, approved in June 2019 and launched in July 2019 by Amgen/Allergan
- Ogivri, approved in December 2017 and launched in December 2019 by Viatris/Biocon
- Ontruzant, approved in January 2019 and launched in April 2020 by Organon/Samsung Bioepis
- Herzuma, approved in December 2018 and launched in March 2020 by Celltrion/Teva
- Trazimera, approved in March 2019 and launched in February 2020 by Pfizer
- Remicade (infliximab, Janssen Biotech), which has 4 biosimilars approved in the United States, but only 3 on the market
- Renflexis, approved in May 2017 and launched in July 2017 by Organon/Samsung Bioepis
- Avsola, approved in December 2019 and launched in July 2020 by Amgen
- Inflectra, approved in April 2016 and launched in November 2016 by Celltrion/Pfizer
- Ixifi, approved December 2017 by Pfizer, which has chosen not to market this product in the United States to avoid competition with Inflectra
- Rituxan (rituximab, Biogen/Genentech), which has 3 biosimilars available in the United States
- Truxima, approved in November 2018 and launched in November 2019 by Celltrion/Teva
- Riabni, approved in December 2020 and launched in January 2020 by Amgen
- Ruxience, approved in July 2019 and launched in January 2020 by Pfizer
Other drugs reviewed were Botox (onabotulinumtoxinA), Keytruda (pembrolizumab), Ocrevus (ocrelizumab), Opdivo (nivolumab), Prolia (denosumab), Tecentriq (atezolizumab), and Xolair (omalizumab). The indications covered by the 10 drugs covered gambit, including various cancer indications, chronic migraine, multiple sclerosis, osteoporosis, psoriasis, Crohn’s disease, rheumatoid arthritis and asthma.
Prolia had the highest margins, on average 215% in hospitals and 49% in medical practices, compared to specialty pharmacies. The smallest hospital market was 76% for Xolair and the smallest physician office profit margin was 7% for Rituxan.
“The data is clear, specialty pharmacies reduce patient costs by preventing hospitals and physicians from charging patients, families and employers excessively high prices to purchase and stock specialty medications themselves,” said Matt. Eyles, president and CEO of AHIP, in a statement. “Secure Drop Shipping is a safe and smart competitive alternative that improves affordability and access for all.”