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Critical Enablers in Reducing Pharmaceutical Expense: The Role of Pharmacy Leaders Today and Tomorro

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Title: Critical Enablers in Reducing Pharmaceutical Expense: The Role of Pharmacy Leaders Today and Tomorro


1
Critical Enablers in Reducing Pharmaceutical
Expense The Role of Pharmacy Leaders Today and
Tomorrow
2
Presenters
  • Elizabeth Shlom, PharmD, BCPS
  • VP/Director, Clinical Pharmacy Programs, GNYHA
    Services, Inc.
  • Marcia Jacinto, PharmD, FASHP
  • Director of Pharmacy, Englewood Hospital and
    Medical Center
  • Emily Kao, RPh, MS
  • Associate Executive Director for Clinical and
    Ancillary Operations, North Shore University
    Hospital

3
Program Objectives
  • 1 - Describe strategies to reduce and manage
    rising drug expenses
  • 2 - List challenges to the successful reduction
    and management of rising drug expense
  • 3 - Discuss the need for Executives to help
    champion the cause of controlling rising drug
    expense

4
Trends in Prescription Drug Prices
5
National health expenditures are significantly
increasing and will be progressively more of the
U.S. economy.
6
Consistent Increases in National Health
Expenditures for Prescription Drugs
  • 1993-2001 From 5.8 to 10
  • CMS projection 8.0 - 8.4 average annual
    change through 2015
  • 2015 projection 446.2 billion (370 increase
    over 2000)
  • Percent increase per year has decelerated
  • decrease in drug utilization
  • increasing cost burden on consumers
  • significant patent expirations in 2002-03

Change from Previous Year
CMS National Health Expenditures Projections
2005-2015
7
Drugs in Development Effects on Drug
Expenditures
  • Number of drugs approved
  • Orphan drugs have limited effect on expenditures
  • Innovative therapies that treat previously
    untreatable diseases have higher drug costs
  • Approval times are increasing
  • FDA more cautious and requiring multiple review
    cycles
  • Why?
  • First 6 months of 2005
  • 11 public health advisories regarding drug risk
  • 45 black-box warnings

Hoffman JM, et al Projecting future drug
expenditures--2006. Am J Health Syst Pharm
200663123-138.
8
Drug Approvals Many Unique New Drugs Are Being
Approved
  • New molecular entities (NME) are unique new drugs
    available for use
  • 187 NMEs approved from 1999-2005

9
Drug Approvals Significant Advances Over
Current Therapies
  • Includes biologic therapeutics since 2004
  • Given priority review
  • -105 new drugs from 1999-2005
  • - 8 months median review time

10
Generic Drugs
  • Consolidation of Generic drug companies
  • Novartis acquired Eon Labs
  • Teva acquired Ivax
  • Biological agents no generics yet!
  • Approval process for generic biologicals is
    unclear
  • Human growth hormone and insulins approved under
    NDAs, but application for generic growth hormone
    was denied in 2004
  • 20-30 lower cost expected for generic
    biologicals

11
Pharmaceutical expenditures within hospitals will
significantly increase
  • In 1999, 12.3 of all non-labor expenditures in
    hospitals were for pharmaceuticals
  • By 2009, expenditures for pharmaceuticals will
    increase significantly.
  • Injectable drugs account for 74 of total
    inpatient drug expenditues

Muse Associates The role of group purchasing
organizations in the U.S. health care system.
Washington, DC 2000
12
Pharmaceutical expenditures within hospitals will
significantly increase
  • Expenditures will increase from a combination of
    increase in purchase price and non-price
    inflation
  • Non-price inflation is a function of
  • increase in utilization and volume of drugs
    purchased
  • shifts in acuity of illness and intensity of
    therapy
  • approval of new drugs

Hoffman JM, et al Projecting future drug
expenditures--2006. Am J Health Syst Pharm
200663123-138.
13
Managing Rising Drug Prices in the Hospital
Setting
  • Maximize contract utilization
  • Market share agreements
  • Premier Rational Choice
  • Maintain a tight formulary
  • Involve key physicians in formulary
    decision-making process
  • Focus on best practices and monitor patient
    outcomes
  • Use technology (CPOE) to communicate with
    prescribers regarding formulary medication
    choices and guidelines

14
Challenges to Managing Rising Drug Prices in the
Hospital Setting
  • Use of
  • Non-formulary drugs
  • New, expensive drugs
  • Drugs for unproven indications
  • Intravenous vs oral drugs
  • Drug shortages

15
Case Study Managing Rising Medication Costs in
Bloodless Medicine Surgery
  • Marcia S. Jacinto, PharmD, FASHP
  • Former Director of Pharmacy
  • Englewood Hospital Medical Center
  • Englewood, New Jersey

16
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17
Englewood Hospital Medical Center Bloodless
Institute
  • Patients from 35 States in USA
  • Patients from 25 Countries
  • Major Cardiac, Orthopedic, Vascular,
    Neurological, Gynecological, Hepatic, Thoracic,
    Urologic Surgery
  • Hundreds of Transfers from Other Hospitals
    including those claiming to be Bloodless
    Centers

18
Bloodless Medicine and Surgery - Defined
  • Use of new and existing techniques, procedures,
    technology, and equipment to reduce or eliminate
    use of allogeneic (donor) blood

19
Bloodless and Cost Savings
  • Cost of acquiring ONE unit of Packed Red Blood
    Cells is approximately 225 US
  • TRUE cost much higher (transport, storage,
    administration, potential complications)
  • Study found allogeneic transfusions associated
    with 1000-1500 US incremental Hospital costs

20
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21
Jehovahs Witnesses
  • Do Not Refuse Medical Care, only transfusions
  • Refusal of Blood not a RIGHT TO DIE Issue
  • Actively Pursue Non Blood Medical Management
  • Use of erythropoietin (Epo) to minimize
    transfusion of packed red cells

22
Increased Expenditures of Epo at EHMC
23
Medication Policy Development
Pharmacy Reviews literature Drafts usage
guidelines Presents to medical specialties
Physicians Review guidelines versus
clinical practice
Pharmacy Publicizes guidelines to MDs
Conducts DUE Makes recommendations for
improvement Presents to DUE Committee
Drug Usage Evaluation Committee -gt PT -gt Med
Exec    Reviews/approves usage guidelines
24
EPO - Initial Drug Utilization Evaluation (DUE)
  • Presented to PT Committee Apr 1999
  • 97 patient charts reviewed 3 months
  • Preliminary guidelines for Dialysis, cancer, HIV
    and surgery
  • Showed use in GI bleed
  • Develop guidelines as per literature and MD
    discussion

25
EPO use in Surgery
  • Require History Physical, Hgb measurement
  • Patients requiring special consideration
  • Uncontrolled HBP
  • Iron Deficiency
  • Myelodysplasia
  • B12 or folate deficiency
  • Hypersensitivity to human albumin or mammalian,
    cell-derived products

26
Hgb Monitoring Surgery Patients
27
Patients Deemed at Risk for Transfusion
28
Patients Deemed at Risk for Transfusion
29
EPO Dosing - Surgery Patients at Risk for
Transfusion
30
Monitoring of EPO Patients
  • Elective surgery
  • Non-Elective surgery
  • BP before every dose, Hgb weekly
  • BP before every dose, Hgb postop day 2 and Q 5
    days

31
EPO Dose Adjustments
  • If Hgb increases by 1.5g/dL in any 2-wk period
  • decrease dose by 25
  • If Hgb gt18g/dL or pt develops BP
  • D/C EPO
  •  D/C EPO if clinician believes Hgb has risen
    adequately.

32
Adjuvants to EPO
  • Folic Acid (1 mg/day)
  • Vitamin B-12
  • Ascorbic Acid (500 mg/day)
  • Iron (Oral or Intravenous)

33
Rising Procrit Expenditure as 0f 2001
34
Measures Taken to Control EPO Use
  • Pharmacist reviews EPO order versus approved
    indications/dosing
  • Pharmacist contacts MD if not according to
    protocol
  • Pharmacist contacts EPO Physician Panel if no
    order change
  • EPO MD contacts prescriber
  • EPO administration time changed from 10AM to 6PM
    to give RP time to investigate Procrit order
    prior to dispensing
  • To prevent Procrit dose from being
    misplaced/lost, RN signs for each dose delivered

35
EPO in Anemia of Chronic Disease (ACD)
  • Identified in DUE (Jan 2001)
  • Indications
  • ACD secondary to Rheumatoid Arthritis, Diabetes
    Mellitus, Inflammatory Bowel Disease

36
Follow-up EPO DUE Nov-Dec 2001
  • Compliance with guidelines
  • Indications - 97 Dosing - 99 Iron Therapy -
    84

37
Follow-up EPO DUE Nov-Dec 2001
  • Changes to Epo guidelines
  • Add indication
  • reduce transfusions in critically ill pts with
    sepsis/SIRS
  • New dosing
  • If Hgb lt 7.5g/dL, dose EPO 20K units SC daily
  • If Hgb 8-10 g/dl, dose EPO 40K units weekly
  • Approved by DUE, PT Committees Feb, June 2002

38
Initiatives to Control EPO Expenditure 2002
  • Change Epo 40K to 30K weekly for inpatients using
    order form
  • Based on 3 large, open-label, randomized studies
    on chemo pts
  • EPO 150units/Kg 3x/wk, 10K units 3x/wk, 40K units
    weekly
  • Exclude pre- and post-op patients
  • Project 200,000 savings/year
  • Approved Nov 2002

39
Initiatives to Control EPO Expenditure 2003
  • Change Epo 40K to 30K weekly for oncology, HIV,
    ACD
  • Pts on Epo with Hgb lt7.9 g/dL, change from 20K
    daily to 20K for 5 days, not to exceed 100K in 7
    days

40
Rising Procrit Expenditure as of 2003
41
Initiatives to Control EPO Expenditure 2004
  • Explore darbepoetin as therapeutic alternative
  • Use Procrit for inpatients who need hemodialysis
    Apr 2004
  • Patient monitoring to be done by Clinical
    Coordinator Nov 2004

42
EPO Expenditure as of 2005
43
EPO Expenditure 1999-2005
44
Critical Enablers to Control Drug Expenditure
  • Pharmacy department to
  • spearhead efforts
  • draft usage guidelines based on literature
  • identify MD champions
  • work through medical staff committees
  • explore cost reduction initiatives
  • be involved in monitoring MD compliance
  • Physicians willing to intervene with other MDs
    PRN

45
System Approach In Controlling Pharmaceutical
Costs
  • Emily W. Kao, RPh, MS
  • Associate Executive Director
  • North Shore University Hospital
  • Manhasset, New York

46
North Shore-LIJ Health System Service Area
Introduction and Background
Manhattan
Suffolk
Nassau
Queens
Kings
Staten Island
125 Miles
2003 Patient Origin
Total Population 5.4 Million
46
SourceQM Database and U.S. Census Bureau
47
NORTH SHORE-LONG ISLAND JEWISH HEALTH SYSTEM
Franklin Hosp
Huntington Hosp
LIJ Medical Center
NSUH-Forest Hills
NSUH-Glen Cove
NSUH-Manhasset
NSUH-Plainview
NSUH-Syosset
Southside Hosp
Staten Island Univ Hosp
Nassau University Medical Center
Peninsula Hosp
HCN Hospice Care Network
ACLD Adults Children with Learning
Disabilities Center for Extended Care
48
NSLIJ HEALTH SYSTEM - Expected Drug Expenses
49
Non-Salary Expense Distribution for NSLIJHS
(owned hospitals)
50
System Approach to Formulary Effectiveness and
Safety S.A.F.E Rx
  • Provide safe and cost-effective therapies to all
    patients served through the health system.
  • Share and implement value added best practices to
    maximize use of clinical expertise.

51
  • Goal I
  • System Formulary standardization to reduce
    therapeutic redundancies and improve clinical
    efficacy and safety
  • Goal II
  • Implement strategies to
    decrease inappropriate
    utilization of target medications based on
    targeted DRGs
  • Goal III
  • Implement cost saving
    initiatives
  • Implement automatic
    substitution
  • New drug addition process
  • Class review
  • Posting system formulary on Healthport
  • Target DRG drug appropriateness
  • Identify high cost drug and review where they
    are utilized
  • Out sourcing programs
  • Centralized contracts
  • Therapeutic substitution
  • Epoetin alfa
  • ACE inhibitors
  • H2 antagonist

52
New drug addition review process
  • Key focus
  • Standardize process in new drug addition by
    sites
  • Standardize review process
  • Identify system task force that can assist in the
    class review
  • What should be the realistic timeframe from start
    of drug request to local PT/Medical Board level

53
Approach to standardize formulary
Target class review
Standardization
Utilization
Guidelines
Patient Safety
54
Drug Requests and Utilization by sites
55
System review of new drugs (Xopenex)
  • Usage by all sites
  • Pharmacology review
  • Restriction guidelines
  • System Recommendation
  • Approved with restriction
  • All sites should restrict use

56
System monitoring to track Xopenex use
57
Standardizing drug choices within target classes
  • ACE inhibitors
  • Manhasset Franklin
  • Glen Cove LIJ
  • Forest Hills Plainview
  • Huntington Syosset
  • Staten Island
  • Southside
  • Short acting ACEI
  • Captopril
  • Enalapril
  • Long acting ACEI
  • Lisinopril

58
Standardizing drug choices by disease state
59
Monitoring compliance
Compliance rate ranges from 20 to 75 for the
first three months of tracking to close to 90
within six months
60
Understand appropriate use of Epoetin
alfa throughout the system
61
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62
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63
Sharing Best practices Syringe repackaging
program
64
Achievements to date
65
  • Changing role of Pharmacy leaders
  • Create vision
  • Motivate staff
  • Generate enthusiasm
  • Facilitate teamwork
  • Build relationships

Critical enablers
66
Any system approach must be multi-faceted
  • Prospective Strategies
  • Education of Decision Makers
  • Engagement of Medical Staff Leadership
  • Disease/Procedure Specific Strategies
  • Evolutionary Change

67
67
68
Sometimes, we need to think out of the box
69
LIES OPPORTUNITY
IN THE MIDDLE OF EVERY DIFFICULTY
LETS BE THE ONE TO LEAD THE WAY…………
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