The Drug Pipeline: What's in the Works?

The drug pipeline contains all medications in development, either being studied for first-time approval or expanded indications. The drug pipeline is very important to a drug manufacturer; whether or not a manufacturer has promising therapies in the pipeline can determine its future viability. Pharmacies, especially specialty pharmacies, should be interested in monitoring the pipeline as well. The reason (or reasons) can be found in the trends.

What Trends Are Happening in the Pipeline?

One of the biggest trends in the pipeline is the cost involved of the specialty drugs in and coming out of the pipeline. When discussing specialty medications, in many cases, we’re talking about drugs that are used by less than 2% of the population. Yet, in 2015, they accounted for 37% of the total drug spend! This trend is expected to continue.

We’re also seeing more medications approved by the FDA year-over-year and more medications coming to market sooner than anticipated. The last couple of years have been record years for the FDA in terms of new drug approvals. There were right around 50 approvals last year and half of those were specialty medications — on average, that’s a new specialty drug every other week!

Manufacturers are earning special FDA designations such as fast track, breakthrough, priority review, and accelerated approval, more often. Orphan drug approvals (medications for diseases affecting fewer than 200,000 Americans) have also been steadily increasing since the year 2000. We are also seeing therapy-specific trends. We have seen chronic hepatitis C treatment regimens go from a cure rate of 40% in 2001 (with nearly a year of terribly-tolerated therapy) to more than 90% cure rates with just 8-12 weeks of therapy today. Patients can actually tolerate the newer medications. More hepatitis therapies continue to come to market.

In the treatment of cancer, we’re seeing more drugs that target a specific genetic mutation rather than a broad cancer type. Learn more about targeted therapies here.

It’s these types of trends that are critical to monitor in order to adjust for their impact.

What Drugs are Monitored?

What types of drugs does a specialty pharmacy track? While there are tens of thousands in the pipeline, specialty pharmacies tend to focus on, as you might have guessed, the specialty medications.

One might ask, “How do you determine what is specialty?”Well, that’s a bit more of an art than a science. There are a number of definitions out there, but most of them are just a list of characteristics that specialty medications commonly have.

Other than the Centers for Medicare and Medicaid Services (CMS), there is no objective definition of a specialty medication. CMS states that any drug $600 or more is a specialty medication. But this is a pretty narrow definition and ignores many of the other characteristics that are important in differentiating a specialty medication from a non-specialty medication.

Does the medication require special handling, such as refrigeration? Is the medication administered via a non-traditional route (ie, not oral)? Is it indicated for a chronic or rare disease? Does it require high-touch, such as detailed patient counseling or monitoring for side effects or efficacy? Is there a risk evaluation and mitigation strategy (REMS) program mandated by the FDA? Is the medication usually prescribed by a specialist? Answering “yes” to these questions increases the likelihood that the drug is considered a specialty drug.

With many specialty medications having the characteristics described, manufacturers are choosing to use a limited panel of distributors. Why? As mentioned, these medications are typically used by less than 2% of the population; specialty pharmacies have concentrated experience working with the conditions treated (or similar conditions) and the manufacturers want to leverage that experience. This way, when a medication requires special handling, high-touch monitoring, administration training, or a REMS program, the manufacturer can be confident that the patient is in the best hands. For the same reason, it is often less costly, in terms of inventory management, to have fewer pharmacies on panel. Instead of producing enough inventory to stock across many pharmacies, the manufacturer can better estimate and supply how much is truly needed by using a limited panel of specialty pharmacies. Then, last, but not least, is the trade-off between the manufacturer and the on-panel pharmacies. Gaining access to a limited distribution drug drives revenue to a specialty pharmacy. In turn, the specialty pharmacy often must provide de-identified data — sometimes in the form of daily reports – to the manufacturer, on the utilization of their drug. In effect, the manufacturer has greater control and insight into the use of its medication when it uses a limited distribution channel.

What Type of Information Is Monitored?

There are several characteristics of a medication in the pipeline that may be tracked by a pharmacy. One important example is the reason for tracking — is it a novel therapy, an expanded indication, or a generic that may impact another therapy or class of therapies?

Where will it fall in therapy is another — will it be first-line with significant advantages over the standard of care, or is it just a “me too” drug offering little difference compared to therapies already on the market? What type of prescription volume or sales are expected for this medication once it is approved? What safety and efficacy data can be gleaned from the available clinical trial results? What FDA designations has the therapy received that may lead to earlier-than-expected approval? Keeping track of characteristics like these really helps a specialty pharmacy prepare for new drugs coming to market.

How Does Monitoring Help?

Monitoring the pipeline can help in 2 major ways: communication and service preparation. For communication, the pharmacy that monitors the pipeline is better prepared to communicate changes (namely approvals) to internal and external stakeholders.

Employees need to know know when a drug is approved and when to expect it to be in stock and available for dispensing. This helps them answer all the questions that are rolling in from patients and prescribers. It is also important to communicate directly with prescribers, letting them know a new medication is available in their practice area. Finally, new approvals impact payers (insurances) and knowing when a medication hits the market allows payers to adjust accordingly (eg, formularies, utilization management, etc.).

On the service preparation side, having monitored the drug in the pipeline allows a pharmacy to prepare in advance how it will best take care of patients who ultimately receive the drug. This may include creating custom clinical programs with touch points that correspond with the drug’s side effect profile. It may also include assessing specialty packaging options for the medication to make taking it easier to remember and to do so correctly (especially with complex regimens). It may also be decided to provide special educational materials with the medication to help the patient be better prepared for treatment.

As you can see, monitoring the pipeline is important for pharmacies and can really help a specialty pharmacy prepare for new therapies coming to market.