• Intro
• Commercial Market
• Medicare
• Prior Authorization
• Quantity Limits
• Strategic Implications

Strategic Implications and Questions

The impact of patent expiration for two prominent brands has been surprisingly minimal on the remaining single-source brands. It might be assumed that the widespread availability of lower cost generics would put downward pressure on formulary access for remaining branded products. This dynamic appears to be in play for the statin marketplace, where the availability of simvastatin appears to be a viable alternative, thus having an impact on branded statins (see Fingertip Formulary Insights Volume 1, "Impact of Patent Loss for Zocor on the Statin Marketplace"). Thus, it appears that the impact of generic products varies by therapeutic area and it is therefore important for pharmaceutical manufacturers and others to examine the dynamics of their specific areas of interest.

Pharmaceutical managed care marketing and brand teams need to understand differences in the Medicare and commercial markets. In the anti-depressant market, there is a clear dichotomy in prevalence of restrictions between commercial and Medicare plans both on an absolute basis at present, as well as trend differences over the past 17 months.

Changes in access, as measured by tier status, should be evaluated in concert with changes in restrictions, such as PA. The impact of large positive movements in tier 1 or 2 gains will be muted if they are also accompanied by concomitant increases in PA restrictions. It is important to understand the overlay of PA restrictions and tier status -- after all, PA when placed on a product that is on tier 3 is generally much less of an access issue than prior authorizations that occur when products are tier 2.

Changes to tier 1 and 2 availability for the Medicare market tend to be more prominent than in the commercial market at the beginning of each new calendar year. Additionally, Medicare lives are much more concentrated than commercial members, with the two largest Medicare providers covering approximately 30% of the overall Medicare market. Therefore, the possibility of significant Medicare access changes is very real at the start of each new calendar year.