By partnering with drug manufacturers to connect customers with clinical trials, the retail pharmacy chain believes this new venture will be the company’s “next growth engine.”
Walgreens is launching a business to connect customers with clinical drug trials, a venture that adds another offering to the retail pharmacy giants’ growing menu of healthcare services. This new venture might also mean additional test orders for clinical laboratories and pathology groups in areas that serve Walgreens customers.
Now, Walgreens is attempting to further redefine the patient experience by partnering with pharmaceutical companies to find participants for clinical trials, a business that could result in more Americans from underrepresented racial and ethnic populations enrolling in drug-development trials. With 9,021 retail pharmacies in all 50 states, it is well-positioned to know which of its customers would be candidates for different clinical trials.
“Walgreens’ trusted community presence across the nation, combined with our enterprise-wide data and health capabilities, enables us to pioneer a comprehensive solution that makes health options, including clinical trials, more accessible, convenient and equitable,” said Ramita Tandon, Walgreens’ Chief Clinical Trials Officer, in a press release.
Ramita Tandon, Walgreens’ Chief Clinical Trials Officer, believes Walgreens can play a role in solving the issues of diversity and declining enrollment in clinical trials. “Through the launch of our clinical trials services, we can provide another offering for patients with complex or chronic conditions in their care journey, while helping sponsors advance treatment options for the diverse communities we serve,” she said in a press release. (Photo copyright: Walgreens.)
Serving the Socially Vulnerable
In an interview with Fierce Healthcare, Tandon described the clinical trials business as Walgreens’ “next growth engine” of consumer-centric healthcare solutions.
According to the company press release, “Walgreens is addressing access barriers through a compliant, validated and secure decentralized clinical trial platform built on a rigorous compliance and regulatory framework to ensure patient privacy and security. This approach leverages owned and partner digital and physical assets, including select Health Corner and Village Medical at Walgreens locations, to directly engage patients at home, virtually or in-person.”
Walgreens notes that more than half of its roughly 9,000 U.S.-based stores are in “socially vulnerable areas.”
According to the Washington Examiner, a US Food and Drug Administration (FDA) study revealed that 75% of patients who participate in clinical trials are white, while just 11% are Hispanic and fewer than 10% are Asian or black. In addition, participation in clinical trials has been declining, with 80% of trials failing to attract enough participants on time.
Tandon maintains that making the process of participating in clinical trials easier is another key to increasing diversity and participation in clinical trials.
“During the clinical trial journey, we know it’s a burden for patients to visit sites. We also know that 78% of patient-consumers in the US live within five miles of a Walgreens,” she told PharmaVoice. “If a patient can complete much of the up-front clinical trial requirements at a local Walgreens, or conduct some of the visits digitally, it would make the whole clinical trial experience that much more positive and, maybe, encourage the patient to participate in new clinical trials going forward.”
Walgreens also plans to use its treasure-trove of customer data to find potential patients for its trials business.
“Understanding this detail of customer preference and segmentation can be quite useful particularly in clinical trials, for example, to create better protocols,” Tandon told PharmaVoice. “We are sitting on so much information, but we can, and need to, do a better job of using these insights in a real-world setting, which can be translated to pharma R/D or brand management organizations. We’re all about patient-centric drug development.”
FDA Seeks Diversity in Clinical Trails
Walgreens is in discussions with several drug manufacturers as it looks to launch this new venture.
“We are working very closely with them to understand their business needs and create the solution that’s going to be sort of bespoke to their specific trial needs,” Tandon told Fierce Healthcare. “Our goal is to move that needle and start to see a larger number of US patients participating and highly diverse participants that are coming into clinical trials.”
In April, an FDA press release announced new draft guidance aimed at “developing plans to enroll more participants from underrepresented racial and ethnic populations in the US into clinical trials.”
“Despite having a disproportionate burden for certain diseases, racial and ethnic minorities are frequently underrepresented in biomedical research,” the FDA stated. “Clinical trials provide a crucial base of evidence for evaluating whether a medical product is safe and effective; therefore, enrollment in clinical trials should reflect the diversity of the population that is ultimately going to use the treatment.”
Disintermediation of Retail Pharmacies
“Walgreens has a significant opportunity to create an interconnected healthcare ecosystem where we can use the physical assets of Walgreens and connect with patients and consumers at a local level to better support healthcare and healthcare equality,” Tandon said in PharmaVoice.
This is the latest example of a billion-dollar retail pharmacy chain diversifying away from simply filling prescriptions. Two types of competitors are driving the disintermediation of retail pharmacies because they end up directing patients away from the pharmacy:
Amazon.com acquired PillPack and now sends, via mail, prescriptions to patients’ homes.
Pharmacy benefit management (PBM) companies with a business model that encourage patients to get 90 days of prescriptions at once, mailed to their home.
In both cases, retail pharmacies lose access to patients. This is what is motivating several national pharmacy chains to offer primary care within their retail pharmacies (where following an office visit with a general practitioner, the patient simply crosses the store to the pharmacy to fill his/her prescription), as well as the clinical trial matching business.
As retail pharmacy chains become an increasingly disruptive force in healthcare, clinical laboratory managers and pathologists should be preparing new strategies to meet the testing needs of a changing primary care delivery model, which likely will include lab testing being offered in nontraditional medical locations.
Clinical laboratories and anatomic pathology groups should consider this another example of how CMS is taking forward steps to encourage value-based payment arrangements throughout the health system
With the sky-high cost of many prescription drugs and gene therapies, it was only a matter of time before the Centers for Medicare and Medicaid Services (CMS) would seek to link reimbursement for them to patient outcomes.
A recent CMS proposed rule (CMS-2842-P) concerning value-based purchasing (VBP) for prescription drugs covered by Medicaid encourages payers to engage in Medicaid state value-based purchasing (aka, pay-for-performance) arrangements for expensive prescription drugs. This rule may have implications for medical laboratories and anatomic pathology groups if it were extended to cover companion diagnostics linked to expensive therapeutic drugs and gene therapies.
CMS also intents the proposed rule to help drug manufacturers ease roadblocks to contracting with payers—including Medicaid—a CMS fact sheet explained.
Federal officials are looking to reimburse healthcare providers for prescribing drugs that are shown to work best on patients that truly need them, while also incentivizing pharmaceutical manufacturers to created drugs “of high patient value,” stated Laffer Healthcare Intelligence, a Nashville, Tenn. healthcare investment firm, in an email to its intelligence service subscribers.
In a press release announcing the proposed rule, Seema Verma, CMS Administrator, said “We are creating opportunities for drug manufacturers to have skin in the game through payment arrangements that challenge them to put their money where their mouth is.”
Old Regulations Don’t Address Value, Expensive Gene Therapies
According to CMS, for 30 years federal regulations have favored the “volume of drugs” sold over the “quality of drugs.” Simultaneously, during the past three years the US Food and Drug Administration (FDA) has approved four gene therapies with many more “in the development pipeline,” Verma wrote in the journal Health Affairs. “While the lifesaving impact of these often-curative therapies are profound, their costs are unprecedented,” she stated.
CMS’ new rule proposes to define value-based purchasing as “an arrangement or agreement intended to align pricing and/or payments to evidence-based measures and outcomes-based measures,” Verma added.
Companion Diagnostic: Molecular and Genetic Testing
For clinical laboratories, the case CMS makes for therapeutic drugs could be applied to expensive molecular diagnostics and genetic testing. CMS may base reimbursement on how accurately and how fast a lab test can enable a diagnosis. Also, payment could be linked to a lab’s report and guidance to the ordering provider in selecting a therapy that makes a difference in the patient’s outcome.
“This is exactly the concept of the companion diagnostic,” said Robert Michel, editor-in-chief of Dark Daily and its sister publication, The Dark Report. “Take, for example, a $5,000 genetic cancer test that that stages a $500,000 cancer prescription drug. Patients who will not benefit from the drug will not get it. And the $5,000 lab test may keep, say, 10 people from getting a drug that wouldn’t work for them. Thus, the $50,000 in lab tests could save $5 million in prescription drug costs,” he explained.
For its part, Novartis, the Basel, Switzerland-based creator of Zolgensma, said the proposed CMS changes are “an important first step,” and helpful to the company’s “access strategy” in the US, BioPharma Dive reported.
Healthcare experts envision that deals struck under the new proposed CMS rule will focus on gene therapies and expensive drugs, MedPage Today reported.
“Measuring outcomes is costly; it takes time, and everyone has to come up with a way to do it. So, if a drug costs $50, it’s not worth going to every single patient (in research). If the drug costs $500,000, maybe it’s worth it … figuring out if the drug worked. That’s why people talk about it in the context of gene therapies,” Alexander Dworkowitz (above), Partner, Manatt Health, New York, told MedPage Today. (Photo copyright: Manatt, Phelps and Phillips, LLP.)
According to the Laffer Healthcare Intelligence analysis email, CMS’ 137-page proposed rule is “very broad,” but focuses on three themes:
“First, CMS wants to establish an official definition for VBP models to accelerate development of drug pay-per-value programs.
“Second, CMS want to restrict the amount of opioids doctors can prescribe.
“Third, very subtle changes are proposed that negatively affect the PBM (pharmacy benefit management) industry.”
CMS’ proposal also includes standards aimed at fighting opioid prescription fraud and misuse in Medicaid drug programs, noted Fierce Healthcare.
Transparent Drug Prices
Medical laboratory leaders may want to monitor the progress of this proposed rule. In addition to value-based payment, the rule advances price transparency by clearing the way to sharing prices of therapeutic drugs and how they improve patient care, while also lowering costs.
Meanwhile, a refresh of lab information technology to enable authorization of genetic and molecular tests by payer also may prove worthwhile.
Clinical laboratories may soon find opportunities to assist retail pharmacists who are doing genetic test counseling, as employers’ support of genetic testing advances
In another market example of acceptance of genetic tests by major employers, a new pilot program is underway by Kroger Prescription Plans that offers GeneSight by Myriad Genetics as a benefit. GeneSight is an LDT, a laboratory-developed pharmacogenomic test, used to treat psychiatric disorders, such as depression.
As part of the agreement with Myriad Genetics, Inc. (NASDAQ:MYGN), pharmacists at more than 2,300 Kroger stores will offer counseling about GeneSight to eligible employees and coordinate the testing with referring healthcare providers, according to a news release.
Clinical laboratory leaders and clinical pathologists will want to observe these early steps by Kroger to offer genetic tests and genetic test counseling in a retail pharmacy setting. If the GeneSight benefit option and in-store pharmacy interventions prove popular, Kroger Prescription Plans may soon offer other genetic tests, as well.
“Depression is a leading cause of disability and lost productivity in the United States, and only 40% of people reach remission after their first antidepressant medication,” Colleen Lindholz (above), President of Kroger Health, told the Cincinnati Business Courier. “We are committed to helping people combat this debilitating disease, and we’re proud to launch this pilot program. This test can help patients escape the frustrating process of trying multiple medications in the hopes of finding one that works.” (Photo copyright: EatingWell.)
Kroger Not the Only Pharmacy to Offer Genetic Tests and
Counseling
Headquartered in Cincinnati, Ohio, Kroger (NYSE:KR) is the largest supermarket chain in the US and the country’s fourth-largest employer. Kroger Prescription Plans—a pharmacy benefit manager (PBM)—provides pharmacy management services and clinical programs to employers, including Kroger, in 32 states. But it’s not the only pharmacy company to offer genetic tests and genetic counseling.
Last year Albertsons Companies and Genomind, a personalized medicine platform, launched Genecept Assay (now known as Professional PGx)—a genetic test designed to help doctors make informed treatment decisions for their mental health patients—as well as pharmacy-based genetic counseling at select Albertsons and its subsidiaries, according to Supermarket News.
Participating locations include:
21 Sav-On pharmacies at Albertsons in Boise,
Idaho;
Five Jewel-Osco pharmacies in the Chicago area;
and
Two Sav-On pharmacies at Acme supermarkets in
the Philadelphia area.
The Albertsons-Genomind partnership is aimed at patients who
may be struggling with a medication for depression, anxiety,
obsessive-compulsive disorder, or other mental illnesses. Patients can receive
counseling from “specially trained pharmacists” who work with referring
clinicians to offer [Professional PGx], noted Supermarket News.
Pharmacists as Genetic Test Counselors?
Pathologists and medical laboratory leaders may be intrigued
by the concept of putting pharmacists into the role of a genetic test
counselor. However, pharmacists may need to increase their knowledge of
pharmacogenomics, reported Drug
Topics.
“The science advances in the field are just making it more
critical that pharmacists have a really strong understanding of how to blend [pharmacogenomics]
into their training,” Kathleen Jaeger,
National Association of Chain Drug Stores
(NACDS) Senior Vice President of Pharmacy Care and Patient Advocacy, told Drug
Topics.
However, some see pharmacists as the natural experts in the space. “In my opinions, [pharmacists] should be the people who own pharmacogenetics. It’s a relatively new field, and who better than pharmacists to optimize drug therapy?” Daniel Dowd, PharmD, Vice President of Medical Affairs at Genomind, told Drug Topics.
Pharmacists will need to be proactive in working with companies that provide genetic testing, according to a Managed Health Care Connect Pharmacy Learning Network analysis, which also indicated billing for pharmacists’ informational services would need to be addressed.
“These opinions about this type of role for pharmacists will not be what pathologists want to hear,” stated Robert L. Michel, Editor-In-Chief of The Dark Report, Dark Daily’s sister publication. “Pathologists have had the role of the ‘doctor’s doctor’ for decades. Pathologists are trained in how to recognize disease, how to determine which medical laboratory tests are appropriate for the symptoms displayed by a patient, and how to interpret the results to select the best therapies.
“Additionally, pathologists are trained to understand the
technical performance of clinical laboratory tests, such as whether the sample
was of acceptable quality to produce a reliable result, whether the analyzer
that produced a result was performing within specifications, and what factors
should be considered in tandem with the lab test results when making a
diagnosis,” he explained. “It is easy to see why the pathology profession would
argue that pharmacists lack this depth of knowledge and experience when
ordering and interpreting medical laboratory tests. How the pathology
profession will respond to these developments involving pharmacists,
interpretation of genetic test results, and counseling patients is not yet
clear.”
Opportunities for Clinical Laboratories to Assist
Pharmacies
Additionally, we suggested, clinical laboratory leaders and
pathologists could find opportunities helping others understand the results of
the genetic tests.
The recent partnerships between genetic test companies and
corporate retail pharmacies suggest that clinical laboratories could benefit
from reaching out to pharmacists who are now at a point-of-care and who may be
looking to improve their knowledge of pharmacogenomics.
Growing interest in more transparency for the prices of prescription drugs is reflected in a study published in the Journal of the American Medical Association (JAMA) that highlights disparities in pharma prices for patients, pharmacies, and payers
However, while reference pricing and pricing databases help savvy patients compare prices across a range of procedures, much about pharmaceutical pricing remains shrouded in mystery. This is why calls for greater transparency in how prescription drugs are priced are increasing as well.
The Trump administration, state governments, and advocacy groups have each targeted drug costs as a problem in the current healthcare system. And a March 2018 study published in the Journal of the American Medical Association (JAMA) may further fuel the fires facing big pharma.
Overpayments and the Silence Behind Them
Analyzing 9.5 million claims from Optum’s Clinformatics Data Mart over the first half of 2013, researchers found that approximately 23% of all claims involved overpayments—situations in which the co-pay charged to the patient exceeded what the insurer paid the pharmacy to fill the prescription.
While data from 2013 might not reflect the current state of pharmaceutical pricing, the study brings exposure to trends in both politics and media coverage surrounding the industry.
The study authors found that overpayments totaled $135-million in 2013. Generic medications saw a higher portion of overpayments with more than one in four generic prescriptions costing patients more than what payers paid the pharmacy. However, in the 6% of claims involving branded medication, overpayments were nearly twice as high with an average overpayment of $13.46 per claim.
The researchers also cited data from a National Community Pharmacists Association (NCPA) survey of 628 pharmacies in which 49% claimed to have seen 10-50 occurrences of “clawback fees” in the past month. A further 35% reported seeing more than 50 clawback fees in the past month. These “fees” are part of contractual obligations that payers can use to recoup such overpayments to pharmacies.
Other contractual arrangements, such as “gag clauses” (AKA, non-disclosure agreements), wherein pharmacists cannot disclose to patients when their copay exceeds the cost of filling the prescription without coverage, have garnered coverage in the media.
The Hill recently outlined efforts from senators to stop this practice for both traditional insurance plans and Medicare Advantage and Part D participants. “Americans have the right to know which payment method—insurance or cash—would provide the most savings when purchasing prescription drugs,” Senator Susan Collins (R-Maine) told The Hill.
Rebates, Secretive Deals, and Red Tape in Government Crosshairs
Rebates are another contested aspect of current pricing models. Traditionally, pharmacy benefit managers (PBMs) serve as a middleman between pharmaceutical companies and pharmacies to negotiate prices and maintain markets. PBMs negotiate deals for insurers in the form of rebates. Insurers, however, are using these savings to offer lower premiums, rather than forwarding the savings directly to the customer.
UnitedHealthcare unveiled plans to pass these rebates directly to consumers in early March, The Hill reported.
In a press release, Department of Health and Human Services (HHS) Secretary Alex M. Azar II stated, “Today’s announcement by UnitedHealthcare is a prime example of the movement toward transparency and lower drug prices for millions of patients that the Trump Administration is championing. Empowering patients and providers with the information and control to put them in the driver’s seat is a key part of our strategy … to bring down the price of drugs and make healthcare more affordable.” (Photo copyright: Washington Post.)
The Trump Administration also recently outlined their new “American Patients First” plan for reducing drug prices and out-of-pocket costs for patients.
Key elements of their proposed approach include:
Eliminating gaming of regulations, such as the Risk Evaluation and Mitigating Strategies (REMS) requirements manufacturers use to avoid sending samples to creators of generics;
Restricting rebates through Anti-Kickback Statue revisions; and,
Eliminating gag clauses or clawback fees.
However, pharma industry coverage of the plan is mixed. MarketWatch sees little to worry about, predicting, “[the plan] isn’t expected to hurt drug makers or pharmacy-system middlemen.” Meanwhile, Forbes claims, “[the plan] represents a sea of change in pharmaceutical pricing policy, one that will have a significant effect on drug prices in the future.”
Anatomic pathology groups, medical laboratories, and other diagnostics providers can view this as yet another example of healthcare providers trying to shore up financials and protect profits by protecting sensitive pricing information, as the industry faces increasing scrutiny. Nevertheless, regardless of the outcome, these latest trends emphasize the role that transparency is likely to play—and how clinical laboratories will be impacted—as healthcare reform progresses, both in terms of public relations and regulatory requirements.
