Surprise Deal: Cardinal Health Sells Its Specialty Pharmacy (Again)

The evolving specialty market has just claimed another victim. Cardinal Health is selling its specialty pharmacy to BioMatrix Specialty Pharmacy LLC, a private-equity-backed company. There was no public announcement, so today’s article counts as another Drug Channels exclusive. Below, I provide background about BioMatrix and the specialty pharmacies that wholesalers operate. Cardinal’s capitulation highlights the challenges for smaller specialty pharmacies. Cardinal operates a small, sub-scale specialty pharmacy that has had difficulty attracting patients. What’s more, Cardinal’s overall size as a $137 billion business couldn’t help its pharmacy gain sufficient access to manufacturers’ and payers’ limited networks. Each of the Big … Continue reading Surprise Deal: Cardinal Health Sells Its Specialty Pharmacy (Again)

Drug Channels News Roundup, October 2018: Amgen, Walgreens, Rite Aid’s PBM, Drug Price Ads, and Buy-and-Bill Murray

Boo! Time for my Halloween bag of Drug Channels news stories. This issue’s tricks and treats: Shocking! The gross-to-net bubble for Amgen’s PCSK9 product magically vanishes—and my $0.02 appears Creepy! Stefano Pessina of Walgreens Boots Alliance shares startling thoughts about Amazon, ABC, and more Scary! Shareholders vote today on whether Rite Aid should amputate its PBM Spooky! The Wall Street Journal conjures up a frightfully funny editorial about the drug channel Plus, the Centers for Medicare & Medicaid Services summons Buy-and-Bill Murray for its latest foray into Part B reform. P.S. Join the zombie horde who shamble after me at … Continue reading Drug Channels News Roundup, October 2018: Amgen, Walgreens, Rite Aid’s PBM, Drug Price Ads, and Buy-and-Bill Murray

PBM Pricing Overhaul: Express Scripts Prepares for a World Without Rebates—But Employers May Not Change

This week, Express Scripts announced an innovative pharmacy benefit contracting model for members of the National Drug Purchasing Coalition (NDPC), a group of 18 large employers. Click here to read the fully-titled press release. You should pay close attention to this b.i.g. news. It is structured so that Express Scripts will not profit from the flow of funds from a brand-name manufacturer to a plan sponsor. What’s more, the PBM’s compensation will be fully delinked from drug list prices. Instead, Express Scripts will earn only fixed management fees plus additional at-risk compensation tied to clinical outcomes. I spoke to Express … Continue reading PBM Pricing Overhaul: Express Scripts Prepares for a World Without Rebates—But Employers May Not Change

The Law of Holes: Some Independents Skip 2019 Part D Preferred Pharmacy Networks

Last week, I highlighted the largest pharmacy chains that will participate in next year’s Medicare Part D prescription drug plans (PDP). Today, I examine independent pharmacies’ participation via the pharmacy services administrative organizations (PSAOs) that represent these pharmacies in negotiations with plans. This year’s results show a major divergence in strategies. Three of the four biggest PSAOs will participate in a comparable number of Part D networks, as the big chains do. AmerisourceBergen’s Elevate network, however, continues to go its own way and will skip preferred status in the major Part D networks. You will find its reasoning below. Are … Continue reading The Law of Holes: Some Independents Skip 2019 Part D Preferred Pharmacy Networks

Battle Royale: CVS and Kroger Gain, Walgreens Slips in 2019 Part D Preferred Pharmacy Networks

In Humana Triggers a Pullback for Preferred Pharmacy Networks in 2019 Medicare Part D , I highlighted how preferred pharmacy networks will dominate next year’s Medicare Part D prescription drug plans (PDP). Today, I examine chain pharmacies’ participation in 24 major 2019 Part D preferred networks. Some highlights: CVS, for the second year, has strengthened its position as a preferred pharmacy in many 2019 networks. Walmart and Kroger have maintained the strong positions that they have established over the past few years. Walgreens, however, has slipped as the other chains grow. Poor ol’ Rite Aid will again be a preferred … Continue reading Battle Royale: CVS and Kroger Gain, Walgreens Slips in 2019 Part D Preferred Pharmacy Networks

EXCLUSIVE: Humana Triggers a Small Pullback for Preferred Pharmacy Networks in 2019 Medicare Part D (Plus: Top Sponsors and CVS Health’s POS Plan)

The Centers for Medicare & Medicaid Services (CMS) has recently released the initial raw data on the 2019 Medicare Part D plans. Our exclusive analysis of these data reveals that preferred cost sharing pharmacy networks will be slightly less popular next year. For 2019, 92% of Medicare Part D regional prescription drug plans (PDP) will have a preferred network. This figure compares with 99% of plans in 2018. The decline will occur primarily because two Humana plans will switch from preferred to open networks for 2019. Below, I provide historical context on preferred networks’ growth and then discuss the top … Continue reading EXCLUSIVE: Humana Triggers a Small Pullback for Preferred Pharmacy Networks in 2019 Medicare Part D (Plus: Top Sponsors and CVS Health’s POS Plan)

Does Rite Aid Have the Grit to Succeed With Its EnvisionRx PBM Business?

Let’s check in with poor ol’ Rite Aid, the little drugstore that couldn’t. Over the past year and half, Rite Aid has sold off 2,000 stores to Walgreens Boots Alliance, scuttled a proposed merger with Albertsons, and watched its stock price drop from nearly $9 to about $1. Yikes. Rite Aid’s EnvisionRx business, which includes two small PBMs and some related pharmacy services businesses, still has some value. But as you will see below, there appear to be few synergies between Rite Aid’s pharmacy business and the Envision PBMs. Investors are grumbling that Rite Aid should sell EnvisionRx before things … Continue reading Does Rite Aid Have the Grit to Succeed With Its EnvisionRx PBM Business?

The Cigna-Express Scripts Deal’s Intriguing Connections With—And Implications For—AmerisourceBergen and Walgreens

Almost there! Last week, the U.S. Department of Justice (DOJ) Antitrust Division closed its investigation of Cigna’s proposed acquisition of Express Scripts. Click here to read the DOJ’s closing statement. As with everything in the U.S. drug channel, there’s more to this transaction than meets the eye. Below, I explain how the transaction will benefit AmerisourceBergen (ABC), which supplies the mail and specialty pharmacies of Express Scripts. But as you’ll see, Express Scripts has been relying less on ABC as a source of supply for its mail and specialty pharmacies. Meanwhile, the new organization transaction will have few degrees of … Continue reading The Cigna-Express Scripts Deal’s Intriguing Connections With—And Implications For—AmerisourceBergen and Walgreens

How 2017’s Fastest-Growing, Private Specialty Pharmacies Highlight an Industry Slowdown

Time for our annual review of the Inc. 5000 list, the magazine’s annual ranking of the fastest-growing private companies in the United States. The list offers a valuable snapshot of the dynamic specialty pharmacy industry. This marks our sixth annual review of the list. We have identified nine specialty pharmacies on the 2018 list, which is based upon revenue growth from 2014 to 2017. Annual revenues range from $61.3 million to $1.4 billion. The companies on the list are larger but growing more slowly than those in our previous analyses. The pharmacies and key stats are listed below. For the … Continue reading How 2017’s Fastest-Growing, Private Specialty Pharmacies Highlight an Industry Slowdown

The State of Specialty Pharmacy 2018: Reflections from #Asembia18 (rerun)

This week, I’m rerunning some popular posts before the Labor Day weekend. Click here to see the original post and comments from May 2018. Last week, Paula and I had the pleasure of attending Asembia’s 2018 Specialty Pharmacy Summit. The Specialty Pharmacy Summit remains the most important forum in the specialty marketplace. This year, a record 6,500 people learned, networked, and connected in Las Vegas. It was another year of record attendance. (Here’s the official press release.) Drug Channels again salutes Larry and Robert Irene for sustaining and growing an annual event that unites the entire industry. Today marks the … Continue reading The State of Specialty Pharmacy 2018: Reflections from #Asembia18 (rerun)