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Underwriting and Claims

Getting a Grip on High-Cost Drugs

A Tool You Can Use ​

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High Cost Drugs Identified

As Payers continue to struggle with the surge in both the volume and cost of specialty drugs, RGA has identified a list of 180+ costly specialty drugs with their associated estimated costs.

The full report and tool (available solely to RGA Reinsurance clients) serves as a resource to educate and inform healthcare professionals about high-cost drugs. For the scope of the tool and report, high-cost drugs were defined as costing greater than $50,000 annually or $7,000 monthly. The cost cited is the lesser of the cost to cure the disease (e.g. Hepatitis C) or 12 months of treatment. The exception to this definition is if a lower cost drug is routinely paired with a higher cost drug (e.g.: Hepatitis C drugs), then it is also listed in this report. Costs were based on Wholesale Acquisition Costs (WAC), which is a drug-price data point that represents a manufacturer-reported “list price,” at which, that manufacturer will sell a medication to a wholesaler. Like Average Wholesale Price (AWP), WAC is not based on actual sales information, and it is usually higher than the price at which a manufacturer will sell a drug to a wholesaler. WAC does not represent actual transaction prices and does not include prompt pay or other discounts, rebates or reductions in price.

Research was conducted using both scholarly and public health resources on the Internet and via public and proprietary databases. Sources used are identified in the “sources” worksheet within the tool.

When Data Was Available This Report Identifies

  • Disease Category
  • Brand Name
  • Generic Name
  • Manufacturer
  • HCPCS J Codes
  • Approximate Annual WAC
  • Approximately Monthly Cost
  • Year of FDA Approval
  • FDA Approved Indications

 

 
Read More +

Disease Categories Include

Disease Category

Number of Drugs in each Category

% of Drugs with an identified annual WAC of $100,000 or more

Hemophilia & Related

34

100%

Lysosomal Storage Disorders

10

100%

Other Miscellaneous Conditions

10

100%

Oncology - Melanoma

9

100%

High Cholesterol

4

100%

Oncology - Kidney

4

100%

Growth Hormone Deficiency

3

100%

Oncology - Leukemia

16

87%

Genetic Diseases

10

80%

Oncology - Colorectal

5

80%

Oncology - Myeloma

8

75%

Hereditary Angioedema

4

75%

Oncology - Lung

9

67%

Cystic Fibrosis

3

67%

Oncology - Thyroid

3

67%

Oncology - Breast

5

60%

Oncology - Lymphoma

9

57%

Oncology - Prostate

5

50%

Infectious Diseases - Other Infections

2

50%

Hepatitis C

13

38%

Oncology

6

25%

Multiple Sclerosis

11

9%

Grand Total of 22 categories

183 total drugs

69% of all drugs cost $100,000 or more annually

A Story of a Graph:

The graph below illustrates the variation in high cost drugs costing over $50,000 annually. Of 183 drugs, 126 drugs are over $100,000; that is a whopping 69%!  Still significant is that 48 of 183 drugs cost over $200,000, which represents 26% of drugs over the $200,000 threshold.

The Story of a Graph

  1. Glybera (not FDA approved; used for lipoprotein lipase deficiency)
    • $1,210,000 annually
  2. Ravicti (Indication:  urea cycle disorders)
    • $793,632 annually
  3. Lumizyme (Indication:  Pompe’s Disease)
    • $626,400 annually
  4. Carbaglu (Indication:  hyperammonemia in patients with NAGS deficiency)
    • $585,408 annually
  5. Actimmune  (Indications:  severe, malignant osteopetrosis and chronic granulomatous disease)
    • $572,292 annually
  6. Soliris (Indications:  paroxysmal nocturnal hemoglobinuria and atypical hemolytic uremic syndrome)
    • $542,640 annually
  7. Alprolix (Indication:  hemophilia B)
    • $503,880 annually
  8. Idelvion (Indication:  hemophilia B)
    • $500,000 annually
  9. Naglazyme (Indication:  mucopolysaccharidosis)
    • $485,747 annually
  10. Folotyn (Indication:  peripheral T-cell lymphoma)
    • $450,540 annually

Hemophilia & Bleeding Disorders

RGA has seen a significant increase in the number of claims over $2 million since 2005; one significant driver of these claims is hemophilia.  While the drugs for hemophilia and other bleeding disorders are expensive, inappropriate management of hemophilia and bleeding disorders are much more costly. 

Considerations in care and cost:

The appropriate management of hemophilia is key to minimizing and preventing long-term complications and issues that may lead to higher costs. Appropriate use of treatment plan and medical necessity reviews, along with specialized comprehensive care management can help to mitigate the claims costs.

 
Download "High-Cost Drugs Research Report"

The Authors

  • Rebekah Silverthorn
    RN, BSN, CCM, PHN
    Health Services Consultant
    ROSE® Program
  • Laura Baird
    Research Analyst
    U.S. Group Reinsurance
    Send an email >
Download "High-Cost Drugs Research Report"
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