Expanding Therapies, Indications and Implications for Payors

Pipeline trends that will drive change in 2022
BRIEFING
December 16, 2021
Senior Vice President PBM, Specialty Product Development CVS Health

CVS Health remains laser focused on cost management and ensuring that we proactively manage key market dynamics and emerging trends. As we prepare for the new year, we’d like to share some thoughts on the trends that will shape the PBM marketplace in 2022:

The robust drug development pipeline

This leading trend sets the context for the others that follow. Pharmaceutical manufacturers spend billions on new drug development and are continually seeking approvals for new medications and expanded indications. In the next three years, more than 500 new drugs are expected to seek marketing approval from the U.S. Food and Drug Administration (FDA); 67 percent are specialty drugs.Pipeline Services projections, data 2022 through 2024, as of October 18, 2021. New drug count includes new molecular entities, new biologics, biosimilars, new combinations, new formulations, CAR-T and non CAR-T This pipeline activity is contributing to the continuously expanding importance of the specialty drug market.

Certainly, our hope is that some – if not many – of these new drugs will provide safer or more effective treatment options for certain conditions or new promise for conditions that have historically lacked effective treatment options, improving quality of care overall. We employ careful monitoring of the pipeline and cost management tools to help ensure appropriate use and manage the impact on payor trend.

Some of the most anticipated new drugs in the pipeline include

  • mavacamten for the treatment of hypertrophic obstructive cardiomyopathy in adults
  • tezepelumab for the treatment of severe uncontrolled asthma in patients aged 12 years and older
  • cabotegravir for the pre-exposure prophylaxis of HIV infection
  • bimekizumab for the treatment of moderate-to-severe plaque psoriasis

At every point in a new-to-market drug launch, CVS Caremark is thinking and planning accordingly — helping payors stay a step ahead. We monitor marketinsights, evaluate data and make proactive recommendations to help mitigate trend impact:

Checkmark Initially block coverage of new drugs
Checkmark Review for clinical appropriateness and cost effectiveness prior to formulary decision
Checkmark Apply aggressive, clinically appropriate utilization management criteria with rigorous approval requirements
Checkmark Strongly favor generic use; require objective evidence of need for newer agents
Checkmark Select preferred agent generating lowest net cost option in category

Manufacturers also are expanding populations with new supplemental indications for specialty drugs. The following are expected to be approved in the fourth quarter of 2021:

  • Olumiant (Eli Lilly/Incyte) — moderate to severe atopic dermatitis in adults
  • Xeljanz/XR (Pfizer) — ankylosing spondylitis
  • Rinvoq (AbbVie) — moderate to severe atopic dermatitis in patients ages 12 years and older
  • Oxbryta (Global Blood Therapeutics) — sickle cell disease in patients ages 4 to 11 years

This accelerated pace is likely to continue post-pandemic.

Transformative therapies for rare conditions

Gene therapies represent unprecedented treatment potential as well as financial challenges. They are evaluated by the FDA on the basis of efficacy, safety and manufacturing capability. The gene therapy pipeline has slowed somewhat due to the impacts of COVID-19 and additional FDA data requests.

The FDA expects to approve up to 20 gene and cell therapies per year by 2025.Date provided is either FDA-established PDUFA date or best internal estimates from Pipeline Services. Current as of 11/1/2021.

Some anticipated 2022 gene therapies include:

  • Multiple myeloma: ciltacabtagene autoleucel
  • Hemophilia B: etranacogene dezaparvovec
  • Hemophilia A: Roctavian
  • Beta-thalassemia: Zynteglo

Current activity in the market is focused on balancing potential and cost. With very expensive gene therapies, payors face a large, one-time cost; however, these therapies have the potential to be curative, eliminating what would otherwise be a lifetime of treatment. We are refining our foundational medical and pharmacy benefit strategies to help reduce the costs of gene therapy treatments, while ensuring appropriate utilization of these cutting-edge therapies. We also are developing various approaches to help payors mitigate what could be a significant financial impact from these large, one-time costs – likely for one or only a few plan members.

In addition, payors can take advantage of other complementary approaches to reduce the cost impact of gene therapies, including extending a model such as Aetna’s National Medical Excellence Program to gene therapy; value-based contracting; and an evolution of the role of specialty pharmacy to encourage direct dispensing to prevent costs from increasing due to “buy-and-bill” practices.

The growing significance of biosimilars

Biosimilars have been gaining momentum and can provide additional treatment options with cost savings. As you may know, biosimilar drugs are highly similar to FDA-approved biological reference drugs with no clinically meaningful differences in safety and effectiveness.

We welcome anything that creates competition in the marketplace. For example, since Basaglar was launched in 2016, the cost of Lantus – the reference product – has been steadily declining.Basaglar (insulin glargine) is a follow-on biologic with an identical amino acid sequence to the reference product, Lantus.https://jamanetwork.com/journals/jamainternalmedicine/article-abstract/2781481 In fact, biosimilars average a 30 percent reduction in average sales price (ASP) compared to reference brands’ pre-biosimilar ASP.IQVIA Institute for Human Data Science, Biosimilars in the United States 2020-2024, October 2020

In 2023, Humira, the best-selling drug of all time, will have:https://biosimilarscouncil.org/resource/fda-biosimilars-approvals/

Checkmark Six FDA-approved biosimilars expected to have market launches

Checkmark Three biosimilars pending PDA approval

In 2029:

Checkmark Biosimilars to Enbrel are expected to launch

Interchangeability is likely to affect cost. Per FDA guidance, not all biosimilars are interchangeable with the reference product, meaning that substitutions can be made without the intervention of a health care provider. Only two interchangeable biosimilars have been approved thus far: Semglee, biosimilar for the insulin Lantus, and Cyltezo, a biosimilar for Humira.

Biosimilar uptake in Europe is increasing with each launch, averaging 40 percent of the market after 12 months and 60 percent after 24 months.IQVIA European Thought Leadership, IQVIA MIDAS MTH, September 2020 In the United States, however, challenges to widespread adoption remain. Of 31 approved biosimilar products for oncology, autoimmune and anemia indications, 21 have launched.https://www.fda.gov/drugs/biosimilars/biosimilar-product-informationhttps://biosimilarsrr.com/us-biosimilar-filings/ These launch delays, which limit availability, are mostly due to patent litigation. Although the 2009 BPCI Act grants biologic drug manufacturers a 12-year market exclusivity period, which is longer than anywhere else in the world, patent abuses further delay competition. https://www.biopharmadive.com/news/amgen-enbrel-patent-thicket-monopoly-biosimilar/609042/

Uptake also has been slowed by resistance from the provider community. Providers play a key role in controlling the penetration of new products into clinical practice, but many are apprehensive about switching to biosimilars.https://www.meta.org/papers/physician-attitudes-about-non-medical-switching/30712393

With biosimilars, as with all medications, our lowest net cost strategy applies. Sometimes the lowest net cost product is the reference brand and sometimes it is the biosimilar. Of biosimilars that have launched, we have some preferred biosimilars on our commercial template formularies. We conduct new-to-market product reviews and regular evaluations to stay abreast of this rapidly evolving marketplace.

Medical preferred drug strategies can help clients address rising specialty medical pharmacy spend. These strategies are reinforced at the point of prescribing through Novologix, our proprietary platform that helps manage high-spend categories. Through real-time intervention, Novologix guides prescribers to medical preferred drugs and thus can help influence provider acceptance of biosimilars.

Looking ahead

CVS Health has recently announced its new omnichannel strategy to make health care more affordable, appropriate and accessible for patients, providers and payors. Our vision is a seamless consumer experience, with pharmacy as the foundation.

Want to learn more about how innovation and specialty cost management can help you navigate the drug marketplace in 2022? Ask Us
BRIEFING
December 16, 2021
Senior Vice President PBM, Specialty Product Development CVS Health

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