The specialty is a growing part of the pharmaceutical market. PBM, healthcare systems are vying for that bigger slice of the pie.

Specialty pharmacy, once a niche in the pharmaceutical industry, is poised to account for more than half of the industry’s revenue and this growth has sparked fierce competition for control over drug pricing and distribution. specialty, industry experts said today at the Asembia 2021 Specialty Pharmacies Summit in Las Vegas.

“Specialty drugs now account for about 40% of revenue for the entire pharmaceutical industry,” said Adam

Fein, Ph.D., drug pricing and distribution expert and CEO of the Drug Channels Institute. Within three to four years, that proportion will likely drop to 50%, Fein said.

Although independent specialty pharmacies still represent the largest share of the specialty industry, healthcare providers have taken hold and now represent the second largest share, according to Fein.

“In 2015, 1 in 10 specialized pharmacy was managed by a hospital or a doctor’s office. Today it’s 4 out of 10, ”Fein told attendees at the Asembia meeting. This shift largely coincided with the broader trend towards vertical integration that has affected many aspects of American healthcare, he observed.

Doug Long, MBA, Vice President of Industrial Relations at IQVIA, also spoke at the opening session of the Specialty Pharmacy meeting.

Fein noted that the three largest PBMs in the United States – CVS Caremark, OptumRx and Express Scripts – now handle more than 75% of claims.

PBMs have become owners of specialty pharmacies because most manufacturers market their specialty drugs through tight networks, Fein explained. Meanwhile, the majority of large hospitals now have their own in-house specialty pharmacies and use them as the backbone of their benefit plans. Large hospitals and their health systems “have learned from what PBMs do to channel patients to their business, and in fact the majority of prescriptions filled by these specialty pharmacies come from, are written by, prescribers who work at health systems, ”Fein said.

“Everyone understands that,” he continued, “and this is where the battle is between

these different vertically integrated systems.

Fein also discussed the controversial 340B drug pricing program, which requires drug makers to sell their products to certain hospitals and health organizations at discounted prices. Proponents say it helps lower the cost of healthcare and increase access for disadvantaged patients. Critics say health systems have exploited the program to obtain cheaper drugs and increase their income.

IQVIA data presented in today’s session showed that, excluding all program discounts, purchases through the 340B program account for over 40% of all hospital purchases and approximately 13%. of all the dollars in retail pharmacy.

“This means that these prescriptions generate above-average profits for pharmacies, often profits four to five times higher in gross profit dollars per script than a normal business script, the Medicare Part D script,” Fein said. .

Overall, 340B’s growth is fueled by specialty drugs, and the economics of the program have a huge impact on every facet of the specialty pharmacy channel, Fein noted. And based on net sales, the 340B program is now bigger in some ways than Medicaid, he said.

As for the specialty retail market, recent data shows a decline, largely due to the loss of patent protection for two leading anti-HIV drugs, Long explained. HIV therapies are among the top 10 categories of specialty drugs in the retail market.

Long also shared IQVIA data which showed increased demand for mental health and pain medications during the COVID-19 pandemic.