As last miles go, medication adherence – when patients take the medication that’s been prescribed to them – is among the toughest. Every link in the drug supply chain can impact adherence, determining whether patients are treating their conditions or not, with two factors standing out: accessibility and cost. Significant criticism and skepticism is being cast upon Pharmacy Benefit Managers (PBMs), as policymakers at state and federal levels and regulatory agencies such as Federal Trade Commission conduct inquiries into the role they play and impact on drug pricing.
Prescription prices
The web of parties controlling the prescription value chain, PBMs being at the forefront, have forged a system that routinely inflates the cost of medication beyond reason and have, so far, proven impenetrable to reform.
The Pharmacy Value Chain: Rewrite the Whole Thing?
Doug Hirsch is Cofounder and Chief Mission Officer at GoodRx
“It almost feels like you need a wholesale rewrite to actually fix some of the endemic things that are wrong,” said Doug Hirsch, Chief Mission Officer of GoodRx, perhaps the most successful innovator in the prescription drug pricing transparency space, whose efforts to foster a broader healthcare marketplace continue. “We see a lot of little band aids being put on a very large cut.”
And the cut is severe; patients who can’t afford medication are stuck having to choose between filling their prescriptions or paying for their housing or food, with catastrophic downstream consequences for both healthcare quality and cost.
The winds of change seemed to have blown particularly hard over the past few years, driven in part by the expansive drug pricing provisions introduced in the Inflation Reduction Act (IRA), aimed at addressing exorbitant drug costs.
There was also much-lauded launch of the Mark Cuban Cost Plus Drug Company (MCCPDC), and the more recent news that non-profit health plan Blue Shield of California would be among the first to collaborate with MCCPDC, alongside Amazon Pharmacy and more, to provide more affordable and convenient pharmacy care.
For its part, this collaboration-driven position aligns with Blue Shield of California’s mission in the space, seeking to “transform the system into a value-based model that provides members with the medications they need at a more affordable cost.”
Paul Markovich is CEO of Blue Shield of California
As Blue Shield of California CEO Paul Markovich described about the company’s work in the pharmacy innovation space, “We are working with like-minded partners to create a completely new, more transparent system that gets the right drugs to the right people at the right time at a substantially lower cost.”
From both a policy and industry partnership standpoint, the pressure exerted by Cuban and other disruptors stands to have a long-term effect of reconfiguring the supply chain. But these attention-grabbing names and partnerships aren’t the only mechanisms for drug pricing transparency and change in healthcare at the moment.
A Network Fit to Disrupt Drug Pricing
Sempre Health, for example, is a healthcare platform that’s already showing how lowering the cost of prescription drugs raises medication adherence and improves the health outcomes of patients with chronic illnesses. Since joining the healthcare space about eight years ago, Sempre is helping to crack the code that decades of cajoling and encouraging patients to take their medications has failed to do.
Founded in 2015, Sempre Health is a digital health platform enabling behavior-based, dynamic medication pricing to consumers to improve medication adherence and lower downstream costs.
Think of Sempre’s offering as a good-driver discount, where compliance is rewarded; discounts increase month over month for on-time prescription pickups. By developing a marketplace that connects these traditionally conflicting parties, Sempre has aligned competing interests, achieving a win-win scenario for patients, pharmaceutical companies and health plans.
Lowering Drug Costs by Aligning Interests
Sempre initially partnered with Blue Cross NC (BCNC) and others to lower the cost of medications for people with diabetes, establishing a modest following of members who were incentivized by the rewards program and thus better able to afford and take their medication as prescribed.
Said Joey Alright, BCNC’s associate vice president, commercial pharmacy, regarding the company’s work with Sempre, “We saw an opportunity to help make care easier and more affordable for our members. The Sempre program aligns payors and pharmaceutical manufacturers to better medication use. Members are seeing meaningful savings and health results. Our members have saved $2.5M in out-of-pocket expense in the less than the two years we have run the program. That is an average of $95 per prescription fill.”
It was a promising start, but 2024 has seen the kind of significant cost growth that continues to beg the larger market’s attention.
Health plans have had a favorable view of Sempre’s approach, and the number of participating plans has grown to 18. Health plans have liked the program so much for their commercial members that they’ve taken an important step – using their own plan dollars to implement adherence programs for their Medicare Advantage beneficiaries. A new Medicare Advantage rule requires Medicare Part D plan sponsors to offer members options to reduce out of pocket costs, a theme into which Sempre fits neatly.
Sempre Health’s progress is starting to generate traction even among PBMs, a constituent they have historically not worked with. The company shared that they are now partnered with two of the three largest PBMs, a sign that may be a result of their strength in the market or the results they are seeing in driving medication adherence.
A study published in the Journal of Managed Care and Specialty Pharmacy looking at two classes of drugs, antiplatelets and anticoagulants, found that the group in the Sempre arm had a 63.3% adherence rate compared to 42% for the control arm. The statistically significant lift in the adherence rate was reflected in a 16% reduction in ER visits.
While there wasn’t a corresponding improvement in the total medical spend for the patients in the Sempre arm, there’s an explanation: When patients with chronic disease states shift utilization from inpatient and ER services to outpatient scheduled visits, it doesn’t always reduce the cost of care, but, it’s important to note, their health outcomes improve, as shown in the report.
Reducing Friction
Anurati Mathur, Founder and CEO of Sempre Health
In terms of outreach mechanisms, Sempre relies on text messaging with its members, communicating the reminders that support engagement, for what the company describes as a frictionless experience that’s more effective with their population than an app-based approach. “There can be a lot of friction with apps: downloading, user training, engagement,” said Anurati Mathur, Sempre’s CEO. “We just see really strong engagement with text-based messaging.”
Pharma companies, like Organon, have also seen significant benefits from partnering with Sempre. As Ger Brennan, vice president and global commercial lead of established brands at Organon said, “By increasing discounts month-over-month for on-time medication pick-ups, Sempre makes adherence easier.”
Brennan also noted that Sempre “goes beyond conventional measures by offering medication refill reminders and text support, ensuring ongoing assistance for patients throughout their therapy journey.” He also noted patients “demonstrate greater than 20% adherence to medication, than using copay cards alone. In the last four months we’ve seen a 172% growth in patient enrollment to the program.”
Looking ahead, Sempre notes that it’s on an upward path and on track to deliver an additional $60 million in member savings by the end of 2024, looking to add more drugs to its program, continuing with brand drugs for now, while planning a longer-term strategy to include specialty drugs, which have an outsized impact on the cost of care.
As Mathur noted, “There’s a really long tail of brand drugs for health plans to benefit from. And we haven’t touched specialty yet, which is a really big opportunity.”
Like other networks and initiatives aimed at bringing down drug costs, Sempre has demonstrated enormous promise in the last two years. These combined efforts, plus renewed policy interest to disrupt the pharmacy value chain, stand to have a meaningful impact on medication adherence, which has for so long been the unyielding demon of healthcare.
The winds of change are starting to blow, and they’re making headway into the last mile.