August 17, 2011

Integration is Disintegrating at the PBM/Pharm Level

Sometimes, just when everything seems to fit together, something unravels.  This time it is a relationship between the two biggest purveyors of pharmacy products in the U.S. – Walgreens and Express Scripts.  This is an issue that is one of primary concern to employers who have a contract with one or the other. Good luck to those who have contracted for services from both!

The relationship between employer, pharmacy and pharmacy benefit management firm is one that has significant implications for the on-site clinic and the beneficiaries of the services there.  Generics, the formulary, AWP and 90-day prescriptions are all intertwined and managed through contracts that the PBM holds with pharmacies with the pharmacies dispensing according to those contracts.
Employers are involved in the PBM/pharmacy discussions on issues that can include mail order and retail (if the pharmacy is on-site).  Rebates and transparency likewise come into play.  Sometimes, the meetings between the parties include important health care issues such as patient compliance and adherence.  Sometimes the meetings are just about the cost issues.
In the case of a PBM which is disarticulate from a major retail pharmacy (ala Express Scripts and Walgreens), the complexity can impact patient choice and patient convenience.  Taken to an extreme, it can also impact patient information flow, adherence and compliance.  The result is an inability of the employer to manage an important part (and huge cost component) of the health care event.  We have not added links on this Walgreens and Express Scripts issue.  Any interested reader need only to search on one or the other to see the voluminous reporting that has resulted.  If you look in the last week or so, you will also find references to the Express Scripts offer on MEDCO (the consolidation of these two large firms means that Walgreens will now be facing off on a larger share of the market when MEDCO and Express Scripts merge).
Ideas and solutions are not easy – but ignoring the issue is not an option. (1) Look at your PBM and Pharm contracts and see if there are provisions that allow some form of reconsideration if this type of event occurs.  If not, put in such clauses. (2) Call your PBM and/or Pharmacy provider (if they are part of this fray and devise a plan that preserves the flow of product and information during this time of potential confusion.  (3) Develop a plan for your clinic staff and your beneficiaries to offset the information and misinformation that they may be receiving on this issue.
Comments?  Ideas?  Suggestions?  We know that other readers will be interested.  We have had a lot of queries on this topic and it is not going to be resolved soom.  However, some of the more recent news articles have stated that there will be a solution that will be prompted by the MEDCO acquisition which will make Express Scripts too big for Walgreens to ognore.  We will see.

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