Prescription Drugs That Your Insurer Objects to Paying For

Consumers have a love-hate relationship with prescription drugs.  We love the wonderful new drugs that treat and sometimes cure conditions that were once life-threatening, but we hate the sometimes-unaffordable prices of the latest drugs.  Consumers who have prescription insurance coverage are somewhat insulated from the full price of drugs, but insurers and pharmacy benefit managers (PBMs) place non-price impediments between consumers and the prescriptions their physicians write.

Each month the Food and Drug Administration (FDA) approves new pharmaceuticals for treating diseases and medical conditions.  Drugs.com listed 20 new drugs and 4 first time generic drug approvals in late September 2018.  The makers of these pharmaceuticals are eager to win FDA approval so that they can persuade insurers and PBMs to include those drugs in their formularies.

Formularies list which drugs and price points insurers will cover.  Each insurer choses a list based on the safety, cost effectiveness of the drugs, and an assessment of their competitors’ strategy.  Usually a formulary contains both generic and brand name drugs.

Among the new drugs that FDA approved in May 2018 was a brand name drug called Aimovig (generic name is erenumab-aooe).  A competitor to Aimovig was named Emgality (generic name is galcanezumab-gnlm) and was included in the September list of FDA approvals.  Both are injection treatments and are about 75% effective in preventing migraines after 4-6 months of use.

Aimovig launched at a price level well below what was expected. Aimovig is available at most pharmacies with an average price of $704 monthly for two 70 mg/mL syringes.  The large pharmacies offer Aimovig at $596 for 2 syringes.  Some patients will require both syringes in a month.  As of mid-October, Emgality is not yet available in pharmacies.  When Emgality is widely distributed, it will force Aimovig prices down. When other competitors emerge, prices should drop even further.

If it were just a matter of price, Aimovig and Emgality would be considered relatively high-priced drugs and be consigned to the top tiers of insurers’ formularies.  But several insurance companies such as Optum refuse to cover Aimovig unless the patient has tried several of the older drugs (e.g. Sumatriptan at $12 for 9 tablets) for migraine treatment, and can document that the Aimovig prescription was written by a headache specialist.  Such dispensing preconditions may sound overly restrictive, but they are not atypical among formularies.

In the Cigna Value 3-Tier Prescription Drug List, Cigna lists Tier 1, Tier 2, and Tier 3 drugs.  Tier 1 are generic (low cost to consumer), Tier 2 are preferred brands (moderate cost to consumer), and Tier 3 are non-preferred brands (high cost to consumer).  For some drugs, Cigna will require the consumer to obtain its prior authorization before it will authorize coverage.  For some other drugs, Cigna may force the consumer to go through a “step therapy” plan that requires the consumer to try a lower-cost alternative first, before Cigna will cover the higher-cost brand.  Optum and a few other insurers are clearly imposing step therapy as one of their tactics to limit costs of the expected high volume of migraine prevention prescriptions.

Cigna, and presumably others, list certain drugs that they refuse to cover, and in each case they suggest some alternate drugs.  The refusal is not always about cost, and some refusals look like an attempt to sidestep liability (e.g. for OxyContin and Ambien).  They refuse to cover cholesterol-reducing Crestor, Lipitor, and Zocor, even though these are already very low-cost drugs, however the generic alternatives are covered.  Cigna waits about 6 months after an FDA approval before it attempts to include a new drug in its formulary.  During that period we can expect Cigna to negotiate the best deal from makers of competing drugs.

Some new drugs such as Opdivo  (for cancer treatments) and Harvoni or Sovaldi (Hepatitis C cures) are priced at 10 times the price for Aimovig.  Of course, drugs that achieve “cures” would logically be priced higher than drugs designed for chronic treatments.

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