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Asembia AXS25: Balancing Innovation With Affordability Crucial for Sustainable Rare Disease Economic Models
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Key Takeaways
- Specialty pharmacies for rare diseases struggle financially due to high-touch service demands and rising orphan drug costs.
- Complex reimbursement processes and third-party agreements complicate financial viability for specialty pharmacies.
Experts at Asembia’s AXS25 Summit discussed the economics of specialty pharmacy for rare diseases, addressing high treatment costs and strategies for balancing innovation.
Specialty pharmacies serving rare disease patients are struggling to maintain financial viability while providing critical high-touch clinical services that go far beyond the traditional pharmacy model, but solutions are possible, according to an expert panel discussion held during a business session titled “The Economics of Specialty Pharmacy for Rare Diseases: Challenges & Opportunities” at Asembia’s AXS25 Summit, which takes place April 27 through May 1 in Las Vegas, Nevada.1
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“When I think of the complexity of services provided for rare diseases, we need to ensure that when we are paying for these enhanced services, they are in fact delivering what the patient needs,” John Daly, head of North American patient support services at Sanofi, said during the discussion.1
Speakers at the session included panelists Daly; Richard Faris, chief strategy officer, PANTHERx Rare Pharmacy; Michael T. Einodshofer, president, Merx Consulting; Arpan Patel, vice president, NPS LCM Pipeline and Launch Excellence, Novartis; and moderator Will Pih, cofounder, Two Labs Pharmacy Services. Each expert contributed insights from a distinct background of specialty pharmacy economics for rare diseases, including those from pharma, payers, and specialty pharmacy consulting.1
Tackling a Shifting Economic Landscape
Prices of rare and orphan drugs used in specialty pharmacy continue to rise as innovation in the space continues. Orphan status is often associated with higher market entry treatment costs for newly approved drugs, with one study finding that the median drug cost for orphan drugs used for rare diseases in the US was $218,872, compared with $12,798 for non-orphan drugs. The expert panelists agreed regarding the critical need to implement evidence-based strategies to continue innovating while ensuring affordability for patients.2
Rare disease specialty pharmacies provide critical services to patients who have outsized disease and treatment burdens, according to the panelists. Faris explains that patients with rare diseases often deal with misdiagnoses and limited access to effective treatments for decades, necessitating extensive, “high touch” services. Beyond this, specialty pharmacists with “a high degree of training and empathy” are necessary, Daly explains, along with real-time data sharing to optimize patient outcomes.1
The background of rising costs for rare disease specialty pharmacy comprises myriad factors, according to the panelists. Although pharma partners are often very willing to invest in a rare disease specialty pharmacy’s service, issues arise when third-party reimbursements enter the equation, Einodshofer discussed. Medications for rare diseases are purchased under a different set of circumstances than other specialty and retail drugs, Einodshofer said, requiring a consensus between all stakeholders involved in the reimbursement process.1
“You cannot be losing money on the reimbursement side, expecting to make your business profitable on the services side,” Einodshofer claimed.1
Possible Solutions
Chief among concerns regarding the economics of specialty pharmacy is the shifting landscape of growth in the field. Over the last decade, legacy non-340B pharmacies have been left behind with negative growth as 340B pharmacy and provider margins (+1729%), PBM and health plan rebate margins (+359%), and wholesaler margins (+148%) all increase, and drug spending continues its rapid pace. Pih posited to the panelists if specialty pharmacy was doing something wrong in its approach and if solutions were available.1,3
Panelists offered differing sets of insights. Einodshofer spoke to the feasibility of creative contract solutions between pharmacies and payers, noting that it can help eliminate the risks that could follow third-party reimbursement agreements. Arpan proposed better alignment with pharmacies regarding key performance indicators and other facets of their operations to produce extra revenue in some areas. However, given the specialization that is especially prominent in rare disease treatment, Faris offered a future in which reimbursement differs for rare disease specialization.1
“If we’re going to pay for the cost of those medications, don’t we want to make sure that those medications are used in the right way, as opposed to a race to the bottom from the service side?” Faris asked the panel.1
'Rare Is No Longer Rare'
Although shortcomings exist, innovation and development in specialty pharmacy continue at a rapid pace. As innovation continues and new treatments emerge, a true unmet need can be demonstrated for the small populations who depend on these drugs, according to Daly, who claimed “Rare is no longer rare” in the specialty pharmacy space.1
Pharmacists play a critical role in assisting patients as they navigate a rare disease diagnosis, from the clinical end to providing financial incentives and rebates. Ultimately, Daly expresses his belief that, above all, pharmacists must work to ensure that patients who need a medication are prescribed that medication.1
“The pressure is real for pharma,” Daly said. “When I think of the complexity of the services that must be provided for rare diseases, we need to ensure that when we are paying for these enhanced services, they are in fact delivering what the patient needs.”1
