Sheila Arquette

Specialty pharmacies support patients diagnosed with life-altering and oftentimes life threatening complex health conditions, including cancer, rheumatoid arthritis, multiple sclerosis, cystic fibrosis, hemophilia, rare and orphan diseases and organ transplantation. The National Association of Specialty Pharmacy is a nonprofit trade organization and the only national association representing all specialty pharmacy industry stakeholders. The mission of NASP is to elevate and promote the practice of specialty pharmacy, offering best-in-class education, promoting certification, and fostering connectivity and collaboration amongst all who touch the specialty pharmacy patient along the care continuum, with the ultimate goal of positively impacting patient outcomes and the total cost of care.

The COVID-19 pandemic brought sudden and unexpected challenges and opportunities to all industries, and specialty pharmacy was no exception. Every retail platform from Dollar General to 7-Eleven to Walgreens to Meijer is committed to optimizing their health care delivery services while reducing costs associated with those services and automating where possible. Perceived threats from Amazon and home delivery pharmacy formats have fueled an increased focus on virtual care management and digital patient engagement tools.

Specialty pharmacy’s business model and infrastructure supports centralized prescription fulfillment, including dispensing and delivery, remote patient and disease management, and patient-centric care coordination involving all stakeholders. Specialty pharmacies use virtual communication to counsel patients on medications that require substantial education, monitoring and adherence counseling. They have a proven track record of building relationships and gaining the trust of their patients without ever meeting them face to face, all of which have served to minimize disruption and helped patients continue to receive their life-saving medications in a timely manner throughout the pandemic.

Specialty pharmacy continues to be dynamic, demanding and disruptive, undergoing rapid and dramatic change over the past several years. The pandemic, ongoing issues and emerging trends present additional challenges and opportunities and will continue to have a substantial impact on the specialty pharmacy industry and NASP membership. Some of these include:

Vertical Integration: The three largest PBMs account for more than 80% of the PBM market. Insurers have more financial incentive to fill a specialty drug through their PBM-owned specialty pharmacy. The largest PBMs also dominate the specialty pharmacy market, having their own or an affiliation with three of the four largest specialty pharmacies in the U.S. The impact on pharmacy access for patients and cost to the overall health care system as vertical integration persists is dire.

Pharmacy Networks: In some instances, there have been increased efforts by PBMs to limit the participation of specialty pharmacies in pharmacy networks. Tactics such as demanding impossible terms for participation and nonnegotiable reimbursement rates that do not cover the cost of the drug — let alone the services needed to support the drug and the patient — are common.

Patient Steering: Vertically integrated PBMs have visibility to patient insurance information and claims data and may use the information to steer a prescription for a network pharmacy to the PBM-owned/affiliated specialty pharmacy. Extremely sick and vulnerable patients are threatened with loss of coverage unless they comply. As a result, network pharmacies are subjected to anticompetitive practices, and patient choice and access to their pharmacies is suppressed.

Direct and Indirect Remuneration (DIR) Reform: Some Medicare Part D plan sponsors and their PBMs collect retroactive clawback charges from specialty pharmacy providers and other pharmacies. These fees are collected months after the pharmacy has dispensed the drug and after a beneficiary has purchased the drug. The Centers for Medicare and Medicaid Services (CMS) reported to Congress in spring 2021 that DIR fees on pharmacies have increased by 91,500% between 2010 and 2019. NASP and its members continue to advocate for moving pharmacy price concessions to the point of sale in conjunction with the establishment of standardized, specialty pharmacy specific performance metrics to reduce drug costs for seniors and to protect specialty pharmacy from these egregious and growing practices.

State Trends: As of July 2021, five states have pharmacy benefits carved out of their managed care Medicaid contracts — Missouri, North Dakota, Tennessee, Wisconsin and West Virginia. There is an expectation that in an effort to control rising drug costs, and to respond to general increasing Medicaid costs, more states will look to carve out pharmacy benefits in their managed care contracts. The challenge with a carve-out model for specialty pharmacy is that the pharmacy reimbursement models are set across pharmacy, and not specific to pharmacy type, meaning retail and specialty pharmacy would be reimbursed at the same rate. This fails to take into consideration the more expensive clinically complex drugs that specialty pharmacy dispenses, or the additional patient engagement and support required to manage medications used to treat life-threatening conditions.

State Advocacy: Since the Supreme Court Case Rutledge v. PCMA — which decided late last year that the federal Employee Retirement Income Security Act (ERISA) did not preempt state laws that set minimum rates that PBMs must reimburse pharmacies — many state legislators have introduced “platform policies” that address plan/PBM regulatory reform. Recently, a U.S. Court of Appeals for the Eighth Circuit heard additional challenges to the ability for state laws to regulate PBMs in Pharmaceutical Care Management Association v. Wehbi, et al. In this case, the Eighth Circuit ruled that none of North Dakota’s legislative provisions that regulate PBMs are preempted under ERISA. With this broad-sweeping decision it is anticipated that more states will introduce PBM reform legislation over the next year. In direct response to these bills being introduced, NASP has identified a number of areas where specialty can be better represented, including defining specialty pharmacy, establishing fair reimbursement, and preventing prohibitions on the mailing of prescriptions.

Certified Specialty Pharmacist (CSP) Credential: Some PBMs and payers are now requiring specialty pharmacies to have one or more certified specialty pharmacists on staff in order to participate in their pharmacy networks. While the CSP credential demonstrates aptitude and expertise in specialty pharmacy and is strongly encouraged, it was never intended to be used as a punitive measure to exclude pharmacy network participation.

Growth of the Specialty Pharmacy Industry: Since the 1990s the number of specialty drugs available has increased exponentially and dominated new drug developments. This increase has been fueled not only by approvals in more common “specialty” diseases such as oncology, inflammatory conditions and hepatitis, but in rare or orphan diseases as well.

Consolidation and Diversification: We continue to see consolidation of the specialty market while at the same time experience continued growth of specialty pharmacy offerings beyond traditional practice settings. From employers to health plans to grocers to hospital systems to data/technology providers to those focused on the last mile of the medication’s journey to the patient … all stakeholders want to be part of this ever-changing and evolving industry and are battling for control of their piece of the specialty patient journey.

Investments in Technology and Digital Health Solutions: The demand for personalized treatment, patient education and management, and better patient outcomes is growing every day, especially after the COVID pandemic. Digital health solutions are also needed to address workforce shortages, training and experience gaps, and to navigate the myriad players in the specialty pharmacy and health care space. Specialty pharmacy continues to invest heavily in advanced technology to optimize health care delivery while reducing costs, as well as tracking and reporting outcomes data to payers, manufacturers and providers.

Rare and Orphan Drugs: New treatments indicated for the treatment of rare diseases (also known as orphan drugs) are emerging at a pace much faster than many other drugs. Drugs for rare diseases now constitute a growing part of the pipeline and are expected to account for 22% of all prescriptions drug sales by 2024. While these treatments represent new and potentially life-altering options for the people who use them, they can be extremely expensive and require the high-touch, white glove level of service that only specialty pharmacy can provide.

Gene and Cell Therapies: Human gene therapy seeks to modify or manipulate the expression of a gene or to alter the biological properties of living cells to cure or treat disease. Cellular therapies are designed to replace or repair damaged tissue and/or cells may be used as part of a therapy or treatment for a variety of diseases and conditions. There are hundreds of cell and gene therapies at various stages of clinical development. By 2030, there could be 60 marketed cell and gene therapies treating about 50,000 patients per year at incredible cost, with payers and employers scrambling to develop coverage logistics and financial solutions and clinicians clamoring for the educational resources required to optimize the use of these personalized, precision therapies.

As we look to 2022 and beyond, it has never been more important that we work to create a universally accepted definition of specialty pharmacy. Ensuring network adequacy and that specialty pharmacies — beyond those owned by the vertically integrated organizations — are available in network is critical to ensuring all patients can access the medication prescribed by their physician from the pharmacy of their choosing. It is also integral to ensuring that pharmacy performance is appropriately assessed as more payers focus on the value of pharmacy.

To mitigate the potential impact these challenges and emerging trends may have on membership, NASP continues to focus on:

• Developing best-in-class educational programs and resources for the specialty pharmacy industry, offering CE credit programs for pharmacists, nurses, pharmacy technicians and lawyers, and — new for 2022 — an enhanced NASP Education Center and educational program platform.
• Advocating for federal and state legislation and policies that foster and protect patient access and choice and promote fair and balanced competition. NASP members have access to grassroots advocacy tools and a state-level legislation monthly monitoring and tracking report. In addition, a state toolkit is being developed to help members better understand the state legislative and regulatory process, identify opportunities to get involved, and provide sample legislative language and talking points and on-the-ground examples from members.
• Promoting pharmacist certification, distinction and differentiation. NASP offers the industry’s only Certified Specialty Pharmacist credential, CSP exam prep course, discounted fees for NASP members on initial certification and recertification application, and a new and improved CSP application platform.
• Fostering increased connectivity, collaboration and recognition amongst NASP members and the specialty pharmacy industry through NASP committee participation, the NASP Annual Meeting & Expo, NASP’s Lunch & Learn program, NASP Podcast, Lunch with the Lawyer and Roundtable Webinars, timely news and updates, Corporate Member of the month spotlight program, Woman’ Leadership Book Club, NASP Industry Awards, and a Scholarship Program.
• Elevating specialty pharmacy practice through the NASP Patient Satisfaction Survey Program, our investment in our future specialty pharmacy leaders with our Student Association of Specialty Pharmacy Chapter program and demonstrating the value of complex clinical research through the NASP Poster and Abstract program and Journal of Drug Assessment, an official journal of NASP.
• Embracing all industry stakeholders and working closely to best understand their unique needs to ensure these needs are met and their expectations exceeded including collaboration with the pharmacy community and other organizations (ACHC, APhA, ASHP, HOSP, NACDS, NCPA, NCQA, NHIA, NCPDP, PCMA, PPN, PQA).

Though the specialty pharmacy industry is rapidly changing and evolving, one thing will always remain constant — the patient is at the center of all we do. Specialty pharmacies are a vital member of the health care delivery team and strive to overcome challenges and adapt as needed, ensuring that patients living with chronic and complex medical conditions continue to receive expedited access to treatment, high-touch patient care, and achieve superior clinical and economic outcomes.

Sheila Arquette is the president, CEO of the National Association of Specialty Pharmacy.