New pricing puts some ‘miracle’ drugs out of reach

Print Friendly and PDF By: Andy Miller Published: Oct 10, 2012
Caroline Kulinski

Caroline Kulinski

Caroline Kulinski was diagnosed five years ago with multiple sclerosis, and she went from working as a software trainer to being in constant pain, needing a cane to walk.

“I could no longer tie my shoes,’’ she recalls.

But a drug that she tried, after four others proved unsuccessful, had an almost miraculous effect on her condition. Tysabri, one of the newer “biologic” medications — complex mixtures made from living organisms — slowed down her disease and allowed healing to occur, says Kulinski, a Chamblee resident. She was able to cook again, play the piano and do other tasks.

“It allowed me to have my life back,’’ she says. Now she’s pregnant, with her baby due in December.

But Kulinski still has a major fear. She worries that she won’t be able to afford the drug much longer.

Currently, it costs her $750 a month. But if her health plan goes to what’s called “specialty tier’’ pricing for members, it could cost her $3,000 a month, Kulinski says.

An increasing number of health plans have gone to different pricing for biologic drugs, causing patients’ out-of-pocket costs to rise by hundreds of dollars per month.

Kulinski joined patient advocates, health care professionals, industry officials and others at a Wednesday forum at Emory University to promote awareness and an advocacy campaign to address the issue of biologic drug pricing. Their goal is to get action on the issue from the state Legislature.

Biologic drugs – often injected or infused – treat chronic diseases such as MS, hemophilia, lupus, HIV, cancer and rheumatoid arthritis.

Many traditional prescription benefit plans have three-tiered pricing for regular generic medications (typically $10 to $25), preferred brand-name drugs (in the $25 to $40 range), and non-preferred brand names (often $50 to $60).

Some health plans, though, have put biologics into a new specialty tier, and patients must pay a co-insurance price – a percentage of the cost of the drug – rather than a flat co-pay. That makes some biologics cost a patient up to $1,000 a month or more, even if that patient has insurance.

Blue Cross and Blue Shield of Georgia, the state’s largest health insurer, instituted specialty tier pricing in July.

“These are disease-modifying drugs,” changing the course of a disease rather than just treating symptoms, said Max Lehmann of the National Multiple Sclerosis Society of Georgia.

The number of prescription biologics is expected to grow in coming years. “They are the drugs of the future,’’ Lehmann said.

Currently these drugs are expensive  to develop and manufacture, and they generally have no “biosimilar” alternatives — the biologic equivalent of generic drugs.

With high monthly costs, patients are much more likely not to fill their prescriptions, Lehmann said.

The adoption of specialty tiers is “a relatively new phenomenon in Georgia,’’ he added.

Some states have adopted legislation limiting this pricing. New York has banned specialty tiers; Vermont has put a moratorium on them; California has sought to limit a patient’s out-of-pocket expenses.

Blue Cross, in a statement to GHN on Wednesday, cited the need to hold down health costs for employers. “Specialty drugs currently account for about 17 percent of the average employer’s overall pharmacy cost,’’ the statement said. “Some projections estimate these costs will increase 21 percent to 24 percent annually.’’

In some health plans, Blue Cross said, members will be asked to pay a percentage of their drug’s cost, not to exceed a certain cap, which will vary but generally will not exceed $200 per drug per member per month with an annual cap of $3,000, Blue Cross said.

David Popen, CEO of the Arthritis Foundation’s Southeast region, said specialty pricing shifts health costs from insurers to consumers. “We believe this cost-shifting to patients is discriminatory and unacceptable,’’ Popen said.

Patients who can’t afford the medicine often have to go on disability, said Dr. John Goldman, chief of rheumatology at St. Joseph’s Hospital in Atlanta.

Patient advocates aim to help push legislation through the General Assembly that would impose a moratorium on specialty tier pricing; form an independent study committee on the issue; and require an insurer to give patients 12 months’ notice before adopting such pricing.

Rep. Sharon Cooper (R-Marietta), who chairs the House Health and Human Services Committee, said Wednesday at the forum that it would take grass-roots advocacy and talking to legislators to create momentum for such legislation.

Like Kulinski, Bree Winkler, a rheumatoid arthritis patient, said she lives in fear that her biologic drug will soar in price.

She told the coalition that she became “angry, scared and bitter’’ when she was diagnosed in her mid-20s. “I felt my body was betraying me.’’

Winkler, a counselor who lives in Dunwoody, said her newest drug allows her to walk and run again.

The cost is less than $100 per month, she said. A specialty tier, she added, could multiply that cost eight or 10 times – or more.

 

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  • http://www.facebook.com/profile.php?id=723474325 Darrin Keller

    Wow! I don’t know what to say. I can see the patient’s perspective. But I can also see the drug maker’s perspective in wanting to charge high prices. They know that their products solve problems, rather than just treating symptoms. But what should be the role of patients in this case? Should they simply pay an insurance premium and trust that the insurance company will pick up the difference? The economist in me says that that will result in higher premiums for everyone. So that means insurance companies, on principle, have to push back so as to help control costs. If not, drug makers will act as though they don’t have to price their drugs at an affordable rate. But if biodrugs don’t get the profit that is expected, they may not continue to be developed. So if we really do want drugs that work better and drugs that really do solve problems, the only outcome here is that there will be higher premiums for all… at least until the infant biodrug market matures.

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