By Jen Klarer, Head of Cell and Gene Therapy, and Dinesh Kabaleeswara, Head of Insights & Advisory teams at MMIT, The Dedham Group’s sister company
Navigating the landscape of patient access in the pharma industry has become increasingly complex, extending far beyond traditional channels. The challenges are multifaceted, influenced by evolving policies, innovative payer strategies, and shifts in provider dynamics.
Recent market research conducted by MMIT and The Dedham Group, encompassing insights from more than 300 industry stakeholders, sheds light on the critical barriers to patient access that are top of mind for pharma executives. Let’s take a look at the results of our survey:
1. Across benefits, patient access challenges persist.
Manufacturers rate prior authorization restrictions and step therapy requirements as their top hurdle for strategic planning. The top five oncology categories (breast cancer, prostate cancer, melanoma, multiple myeloma, and non-small cell lung cancer) have been subject to formulary restrictions and exclusions.
In parallel with price increases, out-of-pocket costs continue to rise and are one of manufacturers’ most-cited access barriers. Over the last decade, payers’ new-to-market blocks and exclusions have been a significant access barrier, impacting nearly 50% of all lives across all channels of business. While the intention of payers is to delay coverage rather than deny it, manufacturers must be very clear about how they communicate coverage restrictions and timelines to providers to successfully market their brands.
On the medical benefit side, high out-of-pocket costs were unsurprisingly rated as the top patient access barrier by manufacturers, closely followed by prior authorization restrictions and new-to-market blocks. The addition of new lab testing requirements in prior authorization policies is shifting more of the administrative burden of ensuring access to physician offices, and ultimately, to patients.
2. Access issues are evolving across the value chain (policy, payer, provider).
Pressures on pharma’s bottom line are increasing, from emerging government policies to payers’ cost-shifting strategies to the sustainability needs of providers. Government agencies are adopting new approaches to ultimately lower drug costs, including emerging regulations, value-based payment structures, the Medicaid best price policy, and the Inflation Reduction Act (IRA). While concerns about the IRA’s impact ranked the lowest in our research, more than two-thirds of manufacturers are actively planning to mitigate bottom-line risks associated with the IRA. Throughout the industry, the IRA is definitely top of mind.
Another pressure point is payers’ increasing creativity in syphoning value from pharma. For example, alternative funding vendors carve out certain high-cost specialty drugs from payer coverage and enroll patients in patient assistance programs (PAPs) to avoid paying for therapies. Payers’ increased use of copay accumulators and maximizers also troubles manufacturers, as these programs seek to maximize patient and pharma out-of-pocket payments per fill.
Moreover, we’re noticing that payers are no longer the only stakeholders that influence access. The needle is shifting toward requiring a multi-stakeholder approach for communicating access and coverage drivers, with provider organizations playing a critical role in that value chain. Bottom lines are being squeezed through policy and payer channels, and we’re also seeing reimbursement challenges on the provider side.
Providers are looking to improve their net cost recovery through the 340B drug pricing program, which allows qualifying hospitals that treat low-income and uninsured patients to buy outpatient drugs at a 25 to 50% discount. As therapeutic areas become more competitive and there’s a greater strain to the bottom line on the provider side, we’re also seeing GPO contracting extend beyond the community channel and into other areas such as hospital participation with GPOs.
3. Clinical advancements pose unique access issues per category.
Each area of clinical advancement has its own unique access challenges. For precision medicine/genomic profiling, pharma faces greater complexity in payer coverage guidelines with the involvement of additional entities, like laboratory benefit managers. For immunology, the primary challenge is competitive brand and biosimilar pressure on pricing and contracting. For digital therapeutics, alternative revenue models are becoming more common, as payers remain uncertain about how to handle these therapies.
The use of cell and gene therapies is limited by restrictive prior authorization criteria, inadequate reimbursement, site-level capacity challenges and referral gaps. In biosimilars/generics, downward pricing pressure has negative implications on market sustainability, while for radiotherapeutics, the biggest challenge is HCP infrastructure investment for the handling and administration of nuclear medications.
4. Data is changing the way we assess and address access.
To overcome these access issues, many pharmaceutical manufacturers are turning to real-world data (RWD) and AI to gain a deeper understanding of the patient journey. Almost 70% of manufacturers said they’re incorporating RWD into their access strategies, and one-third of manufacturers are discussing the use of RWD to drive access decision-making.
Manufacturers are using RWD across the product lifecycle. In Phase I and II, they’re using RWD to determine which diseases and molecules to invest in, to select optimal trial sites, and to understand disease progression for standard-of-care integration. In Phase III, they’re using RWD to determine which geographies have the most patients and to anticipate out-of-pocket costs.
Post-approval, pharma companies are using RWD to track patients over time and to identify payers with the highest concentration of patients. We’ll continue to see RWD incorporated not only into HEOR and medical affairs decision-making, but also in commercial analytics and other pharma functions. At present, 73% of surveyed stakeholders are using RWD for purposes beyond market access.
AI is also being implemented into pharma’s activities and strategic decision-making. Currently, AI is being used to determine the size and reach of commercial opportunities, and for disease landscape analyses and HEOR. It is also being used as a means of administrative support, especially streamlining workflows and in knowledge sharing and education initiatives.
5. Investment in access strategy will continue to increase.
Amidst the promise of RWD and AI to help address these ever-evolving access barriers, our research shows that the majority of manufacturers (84%) expect an uptick in access strategy investment in the next three to five years. This is driven by increased value extraction from pharma, more competition in key therapeutic categories, and a growing need for visibility into access barriers across stakeholder channels. RWD is expected to be increasingly critical for strategic decision-making.
What’s more, manufacturers are also shifting access planning earlier in the product life cycle. A third of surveyed industry stakeholders are initiating strategic planning as early as phase 1 clinical trials, and 87% are beginning planning before phase 3 trials. Early stage planning usually includes coverage and reimbursement scenario mapping, evidence generation and resource development planning, and using RWD and AI to anticipate access issues.
By leveraging data-driven insights, embracing innovation, and fostering collaborative partnerships, the industry can navigate the complexities of patient access in 2024 and beyond.
To learn how The Dedham Group can help you address access challenges, contact us. For help navigating the path to market access for your oncology therapy, explore MMIT and The Dedham Group’s joint premier advisory services.
