CVS Caremark's report highlights lowest drug trend in six years

Emphasizes need for 'pharmacy homes'

WOONSOCKET, R.I. — Despite a difficult economy and rising health costs, the benefits of an integrated pharmacy service were evident as CVS Caremark helped its pharmacy benefit manager clients — employers, health plans and third-party administrators — manage pharmacy costs, according to the company's annual "Insights Report."

CVS Caremark's annual Insights Report reviews drug trends and highlights key areas to watch in pharmacy care. In 2010, the average drug trend for the company's PBM client segments was 2.4%, the lowest trend in six years. The company's 2010 drug trend was held in check by the increasing use of generics — as more of these less-expensive medications became available, more physicians prescribed them and more members were willing to use generics, according the CVS Caremark. The company's generic dispensing rate was 71.5%.

Other trend drivers included continued growth in the utilization of complex specialty pharmaceuticals, as well as an increase in utilization of prescription drugs overall. CVS Caremark anticipated these trends will continue this year and, when coupled with the growing impact of chronic disease, sees a need to integrate and coordinate pharmacy care in a centralized location — a pharmacy home — to help members coordinate and simplify their medication management.

"Last year was one of uncertainty and change for our clients as they worked to understand the impact of healthcare reform while also dealing with a sluggish economic recovery," stated Per Lofberg, president of CVS Caremark's PBM business. "One of our priorities is to help our clients navigate healthcare reform and determine how best to implement necessary changes. Even with this added layer of complexity, we helped our clients manage costs and maintain quality care for their members."

In addition to the 2.4% overall trend, the more notable 2011 Insights findings are:

  • Nonspecialty trend — the cost increase for prescriptions excluding expensive biologic pharmaceuticals — was 0.8%, driven by the increased use of generics;

  • Specialty pharmaceuticals continued to be the fastest-growing area of spending in medications, increasing 13.7% from the year before; and

  • About one-quarter of CVS Caremark's clients experienced a reduction in medication costs year-over-year, or a negative trend; one-third of the clients experienced a trend of less than 2.5%.

"The continuing increase in the use of expensive specialty drugs, as well as the growing prevalence of chronic disease, calls for innovative healthcare solutions, such as an integrated pharmacy home to help patients deal with complex therapy regimens and [to help them] stay adherent," added Troyen Brennan, EVP and chief medical officer for CVS Caremark. "Developing a pharmacy home was one of the recommendations raised by our recent research conducted with Harvard Medical School and Brigham & Women's Hospital. That work and this report make it clear we must devise better ways to serve the chronically ill. This trend report shows we are making headway in that fight."

According to CVS Caremark, its programs that maximize the benefits of the integrated enterprise already have been embraced by its PBM clients and their members. For example, Maintenance Choice provides members with two options for receiving 90-day supplies of maintenance medications for chronic conditions, either by using a convenient mail-order pharmacy or by maintaining their face-to-face connection with their local CVS pharmacist, while paying less out-of-pocket for their medications. In addition, the recently launched Pharmacy Advisor program enables members with diabetes to build a relationship with their mail-order pharmacist or local CVS pharmacist, providing information and support that closes gaps in care, can reduce costs and promotes mediation adherence.

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