June 8, 2016
(Washington, D.C.)— New York state legislation (S.2530 and A.6194) that creates a special exemption for drugstores from certain safety and performance standards could increase prescription drug costs by $350 million in 2017 and $5.6 billion over the next decade, according to a new study from the health research firm Visante, released today by the Pharmaceutical Care Management Association (PCMA).
Similar legislation (S.7595-a/A.10290-a/S.7591-b and S.7591-c/A.10293) also being considered in New York would undermine patient safety and make it more difficult for employers, unions, and other health plans to offer home delivery of traditional and specialty medicines.
“The legislation in New York would grant drugstores a ‘free pass’ to evade safety and performance standards,” said PCMA President and CEO Mark Merritt. “It’s wrong to make employers contract with drugstores that may not be qualified to provide complex specialty medicines.”
Specialty pharmacies administer complex biologic medicines, many of which are infused intravenously. They also reduce medication errors, manage and prevent side effects, and promote more affordable alternatives. New York physicians who prescribe specialty medications are highly satisfied with specialty pharmacies and do not think most drugstores have the “expertise and capability” to provide specialty medications to patients, according to a recent survey.
Major findings from the Visante study on the legislation:
- Prescription drug and related medical costs in New York could increase by $350 million in 2017. Over 10 years, the estimated cost could be $5.6 billion.
- The legislation would exempt drugstores from standards related to credentialing, drug utilization evaluation activities, and quality-of-care reviews.
- The bill would undermine pharmacy networks contracts and reduce price concessions offered by pharmacies.
A report by the National Center for Policy Analysis (NCPA) notes that state policymakers should avoid undermining specialty pharmacies’ expertise in dispensing costly specialty medications. The NCPA report states:
“Specialty drugs are very expensive, costing thousands to tens of thousands of dollars per month — creating a gold rush among firms vying to provide these lucrative services.
Well-managed, exclusive specialty pharmacy networks allow manufacturers to track drugs that require specific or complex dosing and laboratory monitoring. FDA monitoring requirements favor tightly controlled networks for safety reasons. Moreover, the Federal Trade Commission (FTC) agrees exclusive networks are an effective means of cost control. Regulations that inhibit drug plans from establishing highly efficient, preferred specialty networks also make it more difficult to ensure the integrity of these drugs.”
A new white paper from sPCMA notes that “specialty pharmacies must offer a full range of clinical and operational services to enhance the safety, quality, and affordability of care for patients receiving specialty medications.”