Life science companies are acutely aware of the financial burden patients face when trying to access branded medications. With an estimated 3 out of 10 American adults not taking medications as prescribed due to cost, affordability is a leading barrier to patient access and something that manufactures have to take seriously if they wish to unlock significant adoption. With rapid initiation of therapy and medication adherence crucial to better patient outcomes and brand viability, making financial assistance programs timely and easily accessible is paramount. That's why most specialty and specialty-lite pharmaceutical manufacturers invest in a variety of financial support programs to support continuity of care. In 2021 alone, about 70% of patients on newly-launched specialty drugs were on some type of patient assistance program subsidized by the manufacturer.
However, in today's healthcare environment, it can be challenging not only to ensure strong patient adoption of these programs but also to ensure that these programs don't deplete margins to the point that they are detrimental to the manufacturer's financial health. Taking the following steps will help ensure your brand's program design aligns with its economic objectives to drive lasting brand value:
Free drug and other financial assistance programs fill the gap created by delays during the insurance authorization process and ease medication access for patients with affordability issues. They are also a useful tactic to deploy when a drug is not yet on payer formularies to ensure that patients can access and benefit from therapies. The most common manufacturer sponsored programs include:
Quick Start – For new patients experiencing a delay due to the insurance approval process, a “first fill” – and potentially refills – of the medication is dispensed free of charge to expedite treatment initiation.
Bridge – Patients experiencing a lapse in coverage due to an expired prior authorization (PA) or change in insurance coverage receive a limited free prescription drug supply.
Patient Assistance Program (PAP) – For qualifying patients who are underinsured, uninsured, or denied coverage, this program provides a economic support to address affordability challenges often for a specified period of time or up to a specific amount.
Copay Assistance – Financial assistance in the form of a copay card or coupon used at the pharmacy counter to reduce or eliminate the out-of-pocket obligation typically for commercially insured patients.
Manufacturers should be aware that patient financial assistance programs are subject to regulatory scrutiny, so manufacturers need to ensure that they avoid noncompliance sanctions and penalties. For example, if offering a program for government insured patients, it’s essential for manufacturers to collect patient attestations to ensure that they don’t bill their plan for the medication.
In addition, copay programs can run the risk of overutilization by pharmacies and the application of copay accumulators and maximizers by payers, which can hurt the manufacturer’s gross net. While these programs facilitate patient access to therapy, establishing business rules that set guardrails to ensure sustainability is vital so that the right program is offered to the right patient at the appropriate time.
With 82% of physicians reporting that PAs lead to treatment abandonment at least some of the time and over 80% frequently refraining from prescribing a therapy because of insurance requirements, there’s no doubt that PA requirements constitute a significant hurdle for patients and healthcare providers.
Integrating a differentiated financial assistance program based on how payers are responding to your product can help brands protect their margins by buying time for coverage while continuing to support patient access and provider experience. Manufacturers should leverage insights on individual payer behavior, such as average approval times and low approval rates, to refine their business rules to differentiate how financial assistance is applied. For example, if you know that a plan often takes a number of days to make a PA decision, you should offer a bridge fill for the patient to get started immediately and apply a PA approval to their subsequent refills to maximize the % of covered dispenses.
Commercialization teams should also monitor payer accumulator and maximizer programs, which keep their manufacturer copay discounts from applying toward the patient’s deductible or out-of-pocket limits, shifting drug costs onto patients and manufacturers. By understanding the utilization of these programs, teams can adjust their financial assistance offerings to protect the bottom line more effectively while still supporting patients. According to the latest data from Drug Channels, approximately 40% of commercial plans have implemented these benefit designs.
Over the past decade, branded pharmaceutical manufacturers have increasingly turned to copayment coupon programs to help defray patients’ out-of-pocket cost-sharing obligations at the pharmacy to drive pull-through. From 2014 to 2016, these copay offsets increased by 32% across all retail brands.
Reimbursement rates across different pharmacies vary substantially, incentivizing some pharmacies to rely on uncovered manufacturer coupons to compensate for scripts that are “underwater,” which will negatively impact the manufacturer’s gross-to-net (GTN).
The key to mitigating this risk is to drive every dispense of your brand through an incentive-aligned pharmacy network in which the individual pharmacies get reimbursed at the highest rates and where you have complete control over when these programs are offered. Coupon usage should be 100% driven by the business rules your team determines which could include approaches like only offering them after a prior authorization has been started by the pharmacy. Check out this ebook to learn more about how to optimize prescription coverage at the pharmacy.
With Phil on your side, your team can accomplish these steps with ease with a data-driven approach that manages your financial assistance program in a way that ensures your budgeted subsidies support the patient as intended while protecting your margins. The PhilRx platform allows for 100% manufacturer control over your financial assistance programs and serves as a digital front door for all of your patient services. Request a consultation today to discover how you can unlock your unique value.
Our consultants will work with you to analyze your current channel strategy and make recommendations for how to improve patient access and increase the percentage of scripts getting covered by insurance.