Retail News Breaks Archives
Walgreens PBM helps clients save
May 19th, 2009
DEERFIELD, Ill. – The pharmacy benefits management (PBM) arm of Walgreen Co. said it held the line on prescription drug costs to clients last year and has produced more savings by increasing generic drug utilization.
In its 2009 Outlook/Trend Report, Walgreens Health Initiatives Inc. said its average total prescription drug cost increase was 4.1% excluding specialty drugs and 5.6% overall last year. The PBM also noted that its highly managed clients saw a bigger savings, with a negative trend of -0.5%.
"In 2008, our Walgreens Health Initiatives team produced its fifth consecutive year of single-digit trends for our clients," Michael Nameth, executive vice president of PBM and specialty pharmacy for Walgreens Health Services, said in an opening letter in the report.
Walgreens Health Initiatives also raised its generic dispensing rate last year to 65.6%, which it said is among the highest in the industry, and pointed out that the rate for highly managed clients was 67.1%.
"With the recent addition to our portfolio of a new 90-day option for members, we expect to deliver even greater savings in 2009," Nameth commented in the report. "Walgreens90 gives members the added convenience and flexibility to obtain a 90-day supply of maintenance medications at more than 6,500 Walgreens community pharmacies or through mail service with the same pricing discounts."
He said in the letter that Walgreens Health Initiatives forecasts drug prescription spending to rise 5% to 6.5% this year and 4% to 6% in 2010. In addition, he wrote that the PBM expects about 75% of all prescriptions, including specialty drugs, to be dispensed as generics by 2011.
Other findings in the report, which is available online at WalgreensHealth.com/trendreport2009, included the following:
- The strategies adopted by a 130,000-life client, including the addition of a workplace Take Care health clinic, reduced its trend to a negative -0.41% over a two-year period.
- A 100,000-life group could save $473,000 annually by adopting two new specialty prior authorizations.
- Clients that implemented step care therapy realized a cost savings of 69.6% for a certain therapeutic class that topped the savings of a control group that did not implement any changes.
- In the fourth quarter of 2008, Walgreens Health Initiatives achieved a generic dispensing rate of 73.9%, more than 6.5 percentage points higher than figures reported by other PBMs.
- Analysis shows that for every 1% increase in generic utilization, clients realize about 2% savings in total spend.</ul>
Walgreens Health Initiatives serves more than 9.2 million covered lives nationwide and has a national network of over 62,000 pharmacies.