July 6, 2020

JC Scott speaks with Doug Long, Vice President of Industry Relations at IQVIA, about the impact of COVID-19 on the pharmaceutical market. IQVIA is a world leader in using data, technology, advanced analytics and expertise to help customers drive healthcare – and human health – forward.

JC Scott: Welcome to The Pharmacy Benefit, a podcast that highlights the latest news on drug costs, pharmacy care, and patient access with a focus on the role of the PBM industry, I’m your host JC Scott. Now that we’re not just weeks but months into the COVID pandemic, we’re starting to get a better idea of the impact it’s having on the healthcare marketplace. Not surprisingly, healthcare consumption appears to be improving in some areas while the overall economic recovery continues to lag. I want to get into what we’re seeing right now in the pharmaceutical market, why we’re seeing it and what it could potentially mean going forward, both for businesses in space and importantly, the patients that rely on them. Joining me to talk about these dynamics is Doug Long, the vice president of industry relations with IQVIA, a well-respected organization that specializes in health information technology and clinical research.

Doug has extensive experience in healthcare and pharmaceutical research and can help us understand some of these trends and put them into context. Doug, thank you for joining us.

Doug Long: Same here in JC, looking forward to it.

JC Scott: Awesome. Well, why don’t we start off with just a little bit of background on IQVIA as an organization so that our listeners who might not be familiar, have a handle on what you all do. What is IQVIA?

Doug Long: IQVIA is actually a human data science company. And it was the byproduct of a merger between IMS health, which was a pharmaceutical information company and Quintiles, which is a clinical trials company. And we changed the name to Quintiles IMS, and then finally changed to IQVIA. So we’ve been together for about three years now, operating in over a hundred countries around the world.

JC Scott: So tell us what you do as a company.

Doug Long: We capture the sales of pharmaceutical products all around the world, which a physician or high prescribers. We do a lot of real world evidence. We’re doing a lot with medical claims data on clinical trials, a lot on virtually everything we got our fingers in right now.

JC Scott: So you’re doing some of your own data mining and data collection, both from available sources and sounds like some legwork that you all do on your own. And I assume that gives you a pretty good overall view of the healthcare marketplace.

Doug Long: I think we have one of the best views considering on the amount of data that we sit on.

JC Scott: So looking at the work that you’ve been doing over the last couple of months since the onset of the pandemic, what have you been focused on? Not just in the pharmaceutical space, but broadly speaking, what have you been focused on in particular?

Doug Long: Well, what we’re focused on, this [inaudible 00:02:47] our conversation today is the impact of COVID on the pharmaceutical marketplace, but looking at the pharmaceutical marketplace, you’ve got to look at what’s happening on surgeries and outpatient visits and inpatient visits and so forth. We do a lot of statistical modeling on when these different states and different countries are going to peak, but mainly we’re studying what the impact of COVID-19 has been on the pharmaceutical marketplace.

JC Scott: Excellent. Well, let’s use that to start to paint a little bit of a picture of what you all have been seeing since the COVID pandemic first took hold in March. So maybe take us back in time, a couple of months to March 2020, what were some of the first changes in trends and prescription drug fills at retail pharmacies? What were some of the first things you noticed?

Doug Long: Let’s take it back to kind of the beginning of the year, the beginning of the year got off to-

JC Scott: Sure.

Doug Long: A promising start on prescriptions. And then we came to March and when COVID hit, we call that the stockpiling month because everybody got to the stores, the retail pharmacies, or the mail pharmacies to get as much prescription product as they possibly can get. Generally, they were refilled prescriptions. And a lot of those prescriptions were 90 day prescriptions in March, so that really jumped up the utilization in 90 day scripts substantially from what it was before. And so people had a lot of stock on hand. So think about, there was kind of panic, you want to make sure you had as much supply as you possibly can have, think about toilet paper, think about trying to get paper towels, think about trying to get a lot of things.

So that was the stock-up period and probably people’s medical possession ratio is probably higher than ever it was because they were sitting on all these prescriptions in their cabinets, and they were 90 day prescriptions. So we saw March, I call that the stockpiling month, April and May were kind of the month that people were working off what they had in their inventory. So you saw a demand really drop 20% or so in April and May. And recently we’ve seen it start to come back and we’ve seen the year ago, data on a weekly non-adjusted prescriptions, meaning pieces of paper, only down 1% less than it was last year. So it’s coming back and when you adjust it and for 90 day scripts in essence, make 90 day scripts 330 day scripts, is the last two weeks have shown an increase in demand from last year.

JC Scott: Doug, as you look up the last couple of weeks of June, does that tell you that things are getting back to normal trends from what we saw in 2019? Or is it simply that the people who underwent the stockpiling that you referenced back in March, have now hit the end of their 90 day fills, and we’re seeing another round of stockpiling take place?

Doug Long: Well, it’s a complicated answer because you almost have to look at the market on what’s the new prescription, and what’s a refill prescription. You have to look at whether it was an acute prescription or whether it was a chronic prescription. Then you look at whether it was a 90 day or a 30 days. So there’s a lot of metrics there. So hypothetically, what you’re seeing is the refill market coming back and people are now back in June trying to get more refills. You’re also seeing at the same time is that new prescriptions starting to come up from where they were and acute prescriptions were starting to come up because when the market shut down or when you can’t go see a doctor physically or go to a hospital, is that you’re not going to get new prescriptions. So we’ve seen refills come back, new prescriptions have come back and what’s really lagging still is the acute prescriptions. The acute prescriptions will come back, when there’s more hospital visits, surgeries, new patient starts and things of that sort.

JC Scott: And just for the uninitiated, what do you mean by acute prescriptions?

Doug Long: Acute prescriptions let’s just say, you have the flu and you get an antibiotic, let’s say that you had a wound and you needed an antibiotic. So as for the acute medications versus the chronic medications, such as diabetes or hypertension or cholesterol or anti-depressants, anti-psychotics, prescriptions that you’re on for a short time, which are acute and versus a long time, even maybe for the rest of your life are chronic.

JC Scott: Got it, that’s helpful. But the overall takeaway here is that in June, we are starting to see some uptake in new prescriptions, which we might attribute towards returned to perhaps something closer to normal behaviors. But you’re also seeing the refills come back, which may simply be the expiration of people’s 90 day supply that they got back in March. I would assume in that category that you’re seeing people go for another 90 days.

Doug Long: Well, that’s what my expectation would be, but what throws a little wrench into the whole thing is that the unemployment rate, so this is a whole different world than where we were in March, because there’s a lot more unemployment. And though the question is, is that, do these people that lost their jobs, are they uninsured now? Or are they on Medicaid now? And Medicaid generally has a very low percentage of 90 day scripts to begin with. So if you’re in Medicaid, you’re probably not going to see those people come back to 90 day scripts uninsured, probably not coming back to 90 day scripts, they’ll probably get the cheapest prescription they could possibly get. So that’s the caveat on that.

JC Scott: That’s an important caveat and it is complicated to track in part, because we’ve seen some policy change driven at the state and federal level that’s sort of encouraging 90 day fills in areas where in past years we might not have seen them. So a lot of different behavioral incentives now that might be changing in how people are acting.

Doug Long: Yeah, JC I’m never going to understand why the 90 day Medicaid prescription was as low as it was, particularly as cheap as some of these products are, but their rationale as I talked to Medicaid directors is that, just because somebody on Medicaid now, doesn’t mean there’ll be on Medicaid next month. So the question is, do they want to make an investment for 90 days or not?

JC Scott: So my guess Doug is that as a research organization, you prefer to rely on the data and not do a lot of speculative forecasting, but based on what you’ve seen from the latest June numbers, what are your expectations for where the trends go in terms of new prescriptions and refills?

Doug Long: I think the refills will continue on a question as whether it’ll be thirties or nineties, the new prescriptions we’ll come back as the healthcare system comes back online because people still get injured, still get hurt, still need the acute medicines. So we probably had a little setback on that with some of the states closing down a little bit now, but I think that they’re coming back as well. Now, where do we end up? The year is hard to tell, and it depends on where you look at regular prescriptions or adjusted prescriptions. If you look at regular prescriptions, they’ll probably be fewer prescriptions in 2020 than there was in 2019. On an adjusted prescription basis is that that should be flat to positive because more 90 day scripts in the system.

JC Scott: Last question here, in terms of the trends on fills, are there any specialties or any particular therapeutic classes of drugs that had particularly high trends in fills or large decreases in fills that are worth mentioning?

Doug Long: It’s an interesting question. Let’s talk about first the classes that lost the most and number one was broad spectrum antibiotics down 27%, critical steroids down 18%, narcotic analgesics which follows the trend 8% and 13%, and arthritics 10%, oral contraceptives 7%, and [inaudible 00:11:05] it’s 6%. Now, no surprise is the things that went up was bronchodilators. So if you could get an inhaler in March, you’re going to jump on that as much as you possibly could because of breathing issues and so forth, diuretics were up 6%, anti-psychotics were 5%, and anxiety get up 3, and antidepressants up 2.

JC Scott: So I would assume then that, for those areas where you’ve mentioned the significant decreases in fills for some of those that are chronic medications, we’re going to eventually see some negative impact on both adherence and health outcomes as a result of that.

Doug Long: Yeah, there’s a study out a week or so that I saw that adherence is down, which is not a surprise, although what they looked at it here it’s on adjusted basis, meaning a prescription is a prescription basis. And we’re trying to recreate that and look at it on an adjusted basis. Because if people have more day supply, hypothetically, there’ll be more adherent because while you’re measuring on adherence in reality is, do they have it or not? Now whether they took it.

JC Scott: Yeah and that gets to sort of a separate set of questions, which are, what are the channels through which people are able to access their prescriptions right now. As people who’ve listened to our podcast before, know I’m a mail order customer myself, I have a chronic medication I take for cholesterol, I’ve always gotten a 90 day supply in the mail. And I kind of went into the pandemic with the assumption that others were going to discover the convenience of mail order and home delivery and move in that direction. But what is the data telling us in terms of uptake on mail order?

Doug Long: Well, mail did get an uptake because I think partly it was, you’re going to get it anywhere you could get it. And if you’re concerned about going out in public and go into a retail store to pick it up, then mail’s going to be very attractive to you. However, a lot of retail pharmacies now deliver those prescriptions, so that negates one of the potential advantages of mail. So I think there’s been some growth in mail. I got to look at it for a longer period of time to see how sticky it is, but I assume some of the people that got these prescriptions from mail, they’re going to get them again through mail rather than go back to retail.

JC Scott: And are you able to discern within those trends in mail order prescription fills, which ones are new patients filling prescriptions through mail order, or existing patients who are just moving more of their prescriptions over to mail.

Doug Long: JC, I haven’t looked at that, but I think that’s an interesting thing that I could look at is that, we’ve been looking at new and refills, total mail and retail combined, I haven’t seen it separately. So let me look into that and I can get back to you on that.

JC Scott: Douglas, let’s switch gears a little bit. I want to get your insight on shortages in particular. And you mentioned a moment ago that some of the therapeutic classes of drugs where you saw increase in fills, included things like inhalers, right? Which both were important for people coming off of ventilators and continue to be important for patients who suffer from asthma or other chronic breathing conditions. I’m curious, does IQVIA track shortages? What data do you rely on if you do? And what have you seen?

Doug Long: I wouldn’t say that we’re the primary keeper of drug shortages, but we do study a lot. I mean in United States, the University of Utah has the best databases. So we’re aware of it, we’re doing a lot of work on drug shortages in Europe as well. And when you talk about drug shortages, I think the most amazing thing through this whole process has been is, how well the supply chain held up from front end to back end. And in the supply chain, I mean the manufacturers, the PBMs, the pharmacies, the wholesalers, the logistic companies, I mean, there was not many shortages that you saw in reality, and more the shortages had to do with hospitals, particularly ventilators, but that’s not the pharmaceutical businesses.

So a lot of the sedatives were hard to find for these hospitals that may be needed for the ventilator patients. So I give five stars to the supply chain and it came through flying colors and it is a more respected part of every country right now. They know what the supply chain is because even with China being down for five weeks and nothing being made in China, key starting materials and API is, we really didn’t have shortages on generics to the extent that we thought we might. So it held up nicely. Now we have one on Zoloft right now, which seems to be a combination of increased demand, API. One individual factor is usually a combination factor.

JC Scott: Yeah. We’ve been watching the Zoloft shortage as well. And I think unfortunately, as an antidepressant, it’s related to what you were commenting on earlier, the increased mental stress that so many people are feeling during the pandemic. So that may be an issue of increased demand. The other area we’ve been watching is around drugs that are identified as potentially helping to treat COVID, right? So things like hydroxychloroquine, was looked at early on as a potential treatment, now we seem to have an excess supply. Right now there’s a lot of focus on dexamethazone.

Doug Long: Right.

JC Scott: A relatively inexpensive generic steroid, but I’m curious, what you’re seeing as we get the reports of the next drug that might be a critical piece to the puzzle of helping to treat the virus, it seems to me that that that’s where we still have some risk of spot shortages.

Doug Long: Right. So I guess word of mouth, the first one was hydroxychloroquine, and we saw that just accelerate off the charts. So anything that people thought was going to be useful for that people tried it, doctors tried it and people stocked up out and so forth. And kind of the big three right now minus vaccines is remdesivir from Gilead, you just heard that helps people hypothetically in hospitals with their ventilators, the cortical steroids. Now, one’s an expensive brand, one’s a cheap generic. And you also hear about blood transmit transplants passed away from infected patients to non-affected patients.

And I think that remdesivir if I pronounce it right, is that it was donated in June. There was one supplier you could get it from, which was AmerisourceBergen, and the government determined where it would go. And so I think when you have these potential treatments is that you want to make sure that you can get them and then you want to make sure they get to the right places and the right people, what you don’t want to have is people hoarding and stocking up because it doesn’t do a patient any good if they can’t get it when somebody’s sitting at it in another state, in another hospital.

JC Scott: But I guess the takeaway here Doug from what you’ve observed is, yes, we may have some limited examples of drug specific shortages when it’s the word of mouth effect related to potential COVID treatments. But otherwise the supply chain held up really well. There were not widespread shortages of most medications. I’m curious on your view though, as to the effectiveness of the system we have here in the United States for monitoring for those shortages, because I have learned through the course of this and working with our supply chain partners, that at times the data that FDA collects can lag by a couple of weeks and that they really look at things from a national level and not so much a regional or provider specific level. And I’m curious, do you have any takeaways on how we could improve shortage tracking here in this country?

Doug Long: Well, I mean, one of the things I’m going to anticipate is that, on critical drugs, the pandemic drugs, you’re going to have to have a stockpile of those, maybe the stockpiles in the wholesalers. And I think there’ll be also what we know now there’ll be more increased safety stock to have on hand because the ones that are really critical, we’re going to need to make sure we know where they are and then how you get them to the people that need to get them. That sounds like, that’s got to be a public private partnership to make it succeed.

JC Scott: Yeah. The health system pharmacists in particular, I know as you look at public private collaboration on some of this tracking, have been found to have a really effective system for monitoring some of this data.

Doug Long: Well, if you’re looking at it every day and you know what you need in your hospital system, you got to keep your laser focus on that.

JC Scott: Doug, let’s talk a little bit. I want to go back to something that you mentioned at the top as you’re describing the work that IQVIA does, and it’s not just tracking the pharmaceutical marketplace specifically, but you also have to look at the larger trends in healthcare delivery that might impact prescription trends and would like you to reflect on what you’ve been seeing in terms of elective procedures, well patient visits, other optional healthcare. For example, my wife had postponed an inpatient surgery that she had to have done. And she just got that completed last week, and the hospital here in Arlington is pretty much still locked down. I wasn’t allowed to go into the building with her for example, but they seem to be seeing here in Arlington more volume of activity on those kinds of elective procedures, are seeing similar trends nationwide?

Doug Long: Yeah, we definitely are. And of course, this depends on what degree the states have re-opened or what degree they’re still locked down. So if you start out with a baseline pre-COVID, in the week of April 10th, elective procedures were down 88% in the United States, 88%. Now they’re down 32% in the latest week. So it depends where you are, whether the states are opening, not opening and the U.S. backlog, we do look at a backlog by certain type of surgeries, somewhere between 2.3 months and 4.8 months. So the demand will come back, it just depends on how long it’ll take the hospitals to work through the backlog.

JC Scott: So at some point we will see people coming back to get the procedures done that they had deferred, that backlog will start to clear, and you’d anticipate we’ll see a real uptake in that trend, which then of course will impact the prescribing trends from coming out of those procedures.

Doug Long: Yes. I think that’s going to be a back-half trend.

JC Scott: And in the mean time, a lot of the news reporting would tell us that providers have shifted to telehealth with varying degrees of success. What are you seeing in terms of trends around telehealth and how permanent and lasting do you think those may be?

Doug Long: Telehealth is here to stay, it probably did 10 years worth of business in two months because when the doctor’s office were shut down and you couldn’t see a doctor physically, that’s where telehealth came into play. So let’s just say that it was about 1% of the claims before COVID started. And now it is about 12% of the claims and it peaked at about 20% of the claims, why those offices were shut down. Now you see outpatient and inpatient visits going back online. So my next visit at Mayo where I belong, is actually going to be a telehealth one, so that’ll be a new one. And so it’s definitely here to stay, and I think it’s going to be a very important part of healthcare delivery.

JC Scott: But there are limitations, right? In terms of what can be achieved through telehealth in particular when it comes to diagnostics and lead to prescriptions, right?

Doug Long: Right.

JC Scott: My father-in-law is a physician and he has practiced “telehealth” on my family for about 20 years that I’ve been married and don’t turn him in, but he’s not shy to prescribe after a phone diagnosis of strep throat or something here at our house. But generally speaking, it’s pretty hard for a physician to diagnose and prescribe when they can’t physically interact with the patient. Is that right?

Doug Long: Well, think about it this way JC, so your new diabetic patient or potential new diabetic patient, what’s your blood sugar level? So do you have to go test your blood sugar to tell the doctor what it is or he’s going to have to refer you somewhere to get that blood sugar taken? And there’s a number of classes like that, that you might need labs to decide what the next best step is. So there are some limitations to telehealth, particularly on the lab testing in some of the diagnostics.

JC Scott: Yeah. And so for our listeners who are acutely focused on what it means for prescribing trends, the takeaway could be that telehealth may be here to stay, but that could have a negative impact on prescribing trends, or it could be here to stay, but it’s not going to fully replace the need for in person interactions.

Doug Long: Yeah, I would agree with that. I mean, some of the downside of telehealth is a lack of diagnostics, such as vitals and labs, are impacting diagnosis of new conditions, which we talked about. We know that telehealth visits is unlikely to generate as many new prescriptions as a regular office visit does. And people generally will spend less time with a doctor on a telehealth visit than they do in person.

JC Scott: Doug, you’ve been really generous with your time and I want to be mindful of it. Let me ask you just a general closing question-

Doug Long: Really, JC, I have nothing else to do so [inaudible 00:25:49]

JC Scott: Well, I’ve enjoyed the conversation and as we reflect back on it, maybe boil it down for us, looking ahead, what are the two or three key trends that we should all be watching that you’re going to be watching, that are going to tell us that we’re starting to get back to normal.

Doug Long: Well, I think the first thing you need to look at is that, we have all these positive tests on COVID in the United States, and what people seem to lose sight of is that the average age of a COVID diagnosed patient now is 30, and two months ago was 65. And whether you’re going to live or die depends on what your age is, whether you’re in a nursing home, and what kind of comorbidities you might have. So we got to watch what the trend is on that. And I’m not seeing that the new uptake in COVID patients have really increased the death rate. Generally, most people will recover from it. So you got to look at that, then you got to look at what new treatments come down the way in terms of medicines, and what’s the vaccine market and everybody, and his brother is in the vaccine market, there’s Operation Warp Speed and so forth.

So those are kind of the environmental things that you would look at. Closer to home is that you’re going to follow, how does elective surgeries translate into new prescriptions? How does telehealth translate into new prescriptions? Do the 90 day scripts state 90 day scripts or not? So I guess the key measuring points would be, look at what happens with acute prescriptions and look what happens with new prescriptions. And that will show you what the trend is going forward.

JC Scott: That’s helpful Doug, and for anybody who is looking for a resource, I have to say the data that you put out from IQVIA on a weekly basis has just been so informative through the course of this pandemic, as it always has been. So we really appreciate the work that you’re doing and keeping us all informed.

Doug Long: Thank you so much and much appreciated, happy to help.

JC Scott: Well, thanks again for your time today. I think you gave our listeners a really good understanding of what we’re seeing and why we’re seeing it. And I also want to thank everybody for listening today and hope that you found the conversation informative. If you haven’t done so yet you can subscribe to The Pharmacy Benefit on Google, Apple, Spotify, or any of your favorite podcast sites. I’m JC Scott, thank you for joining me.