Spotlight on Market Access

A recent trend among pharmaceutical manufacturers has been restructuring the role of health economics and outcomes research (HEOR) teams within organizations. Rather than leaving them as standalone groups, many have been absorbed into other parts of the company, including medical affairs and market access. Companies can take various steps to make sure their evidence generation evolves with industry changes, meeting the needs of various stakeholders.

John Ross Maclean, M.D., Ph.D., executive vice president and head of medical affairs at Precision AQ, points to three reasons why the role of HEOR within pharma organizations has changed. The first he attributes to “tension between the science vs. the deliverable.”

UnitedHealth Group's UnitedHealthcare is the largest insurer in the U.S., enrolling nearly 46 million lives. In addition to health insurance, United's health services unit, Optum, powers pharmacy benefits management, specialty drug management, care delivery, population health services and data and analytics. This was further fueled by the company's 2022 acquisition of Change Healthcare, which gave United unprecedented insight into patient, claims and outside payer data. United and Optum arguably set the trend toward increased payer integration, fueling a wave of consolidation that sparked CVS Health's purchase of Aetna, Cigna Corp.'s acquisition of Express Scripts and Elevance Health's launch of Carelon.

A recent executive order from President Donald Trump laid out a host of directives with the goal of lowering drug prices and increasing transparency from PBMs. But experts tell AIS Health that the PBM-related goals are not yet very clear. 

The April 15 order notes the first Trump administration’s efforts, such as drug price transparency rules, encouraging development of generic and biosimilar drugs, and requiring that “government-mandated discounts” are passed through to patients. Trump then said that former President Joe Biden’s administration “reversed, walked back, or neglected many of these initiatives” and signed the “misnamed” Inflation Reduction Act (IRA) into law. While the executive order said the Medicare Drug Price Negotiation Program has a “commendable goal” of reducing Medicare drug prices, “its administratively complex and expensive regime has thus far produced much lower savings than projected.” 

With a new executive order on prescription drug prices, President Donald Trump directed HHS to extend the period in which new-to-market small molecule drugs are exempt from Medicare price negotiation, a policy change that pharmaceutical companies have long supported.

The Medicare Drug Price Negotiation Program, which is part of the Inflation Reduction Act, allows the federal government to negotiate the prices of select drugs if they are brand-name medications or biological products without generic or biosimilar equivalents. Drugs subject to negotiation also must have been on the market seven years (for small molecule drugs) or 11 years (for biologics) after FDA approval.

New entities within the biggest vertically integrated PBMs have allowed the parent companies to restructure their profit sources. And the old approach of dispensing generic drugs by mail has largely been abandoned in favor of new ways to grow profit, such as becoming integral parts of the specialty market. Longtime industry expert Adam J. Fein, Ph.D., president of Drug Channels Institute, an HMP Global Company, explored these and other trends and challenges within the PBM industry during an April 4 webinar.

Vertical integration, he explained, can be beneficial to these companies because “they can do more things; they can take more risk.” He pointed to UnitedHealth Group, which has more than 5 million lives for whom it is fully at risk because the company “can control all aspects of care except for hospitalization” via its infusion clinics, physicians, pharmacies, PBM management and insurance. It can “go completely at risk.”