AH021 - Managing Pharmacy Costs in a GLP-1 World, with Bridget Mulvenna

June 7, 2024

Capital Rx

In this episode of the Astonishing Healthcare podcast, Bridget Mulvenna, a former pharmacy program director and our guest on Episode AH002, shares her experience and opinions about how plan sponsors can work through the decision-making process to cover glucagon-like peptide-1 (GLP-1) agonists for weight loss. She also offers some suggestions for consideration and stresses the importance of leveraging data to understand the needs of each plan's members.

Plan sponsors must work closely with pharmacy benefits managers (PBMs) and dive into how coinsurance, prior authorization, third-party point solutions, and other tools or strategies work. The potential impact on the plan's financials and members' experience, as well as the future exposure, must be evaluated today because the GLP-1 drug pipeline is full, and the potential exists for even more new indications on both new and existing GLP-1s. Listen below or on Apple or Spotify and discover what's happened and what to watch for next!


Lightly edited for clarity.

[00:27] Justin Venneri: Hello and welcome to this episode of the Astonishing Healthcare podcast. I'm Justin Venneri, director of communications at Capital Rx and your host. And I'm excited to have Bridget Mulvenna back with us today for a discussion about glucagon-like peptides, yes, the GLP-1s that have taken the healthcare industry by storm, given their seemingly incredibly diverse utility and high price tags. I'll include some links in the show notes, but Bridget is also the perfect guest for this. She's a former pharmacy program director for a large employer and is on our commercial team now. She recently wrote How to Manage Pharmacy Benefit Spend in a GLP-1 World.  

Bridget, thanks for coming back on the show today.

[01:04] Bridget Mulvenna: Thank you for having me again, Justin.

[01:07] Justin Venneri: So, let's jump right into it. Start us off. These GLP-1s have been widely used for diabetes for some time, right? From a plan sponsor’s perspective, why is there so much buzz and fear around them and utilization of them?

[01:21] Bridget Mulvenna: Well, that's really interesting. You're right. They've been around for a while, and I think a lot of people don't realize that the first GLP-1 that was approved by the FDA was approved in 2005.  

So, we have had these drugs in the market for 19 years. A lot of the issues, a lot of the concerns, are about drug spend, right? And how to control drug mix. What we're seeing is more and more patients are getting prescribed GLP-1s as their first line to attack their diabetes. And the reality is that they may not need to go right to that medication. They could potentially be on something else before they go there.  

These drugs are largely injectable -- there is one oral agent right now on the market -- and it is a growing, a booming drug class, 100 or more. I think 124 drugs are in the pipeline. More than half of those are in phase one. And there's eight active agents on the market right now, with a few, like eight or so right now, kind of getting close to that phase three. So, really close to pending FDA approval. This is going to become a snowball effect where, as more and more drugs come into the marketplace, what may happen is you might see some price changes and things like that, but there's a level set already for what we should expect the price to be. And so, what I expect to see is that these new agents come in at a similar price. And so, we're going to see that price be as high as it is now for the foreseeable future.  

And just a reminder, when the FDA approves a drug, it has a patent that's 17 years long, unless it gets a patent extension because it gets some sort of other indication. And what we're seeing with GLP-1s, specifically with Wegovy, a GLP-1 that was originally approved for weight loss, is it now has an indication for prevention of cardiovascular events. That could have significant downstream impacts as far as saving people's lives. But it also means that the people need to stay on the drug for a long time.

[03:46] Justin Venneri: That makes sense. Okay. And so, there's a lot of moving parts here with the pipeline, what's expected to come, what these will cost, if there will be some price compression because of competition. When you wrestled with this in your previous role, what were some of the things that were discussed at the table, so to speak, was it all about the money? Were there other factors at play? What went into the decision, whether or not to cover them?

[04:14] Bridget Mulvenna: Certainly the cost of the drug is a consideration. It's always a consideration. It's the cost of the drug to the plan and the cost of the drug to the member. Right? How are we going to tier this? What is the copay going to look like? Are our employees seeking the coverage of GLP-1s for weight loss? If they are, how are we going to afford this benefit? And should we implement measures so that the plan members, the folks that want the weight loss benefit have a little bit more skin in the game? We can talk about that a little bit more later. We definitely wanted to cover these drugs, GLP-1s for diabetes, but we also needed to look at, are all of the folks that are taking these for diabetes getting the maximum benefit? Are they adherent? Are they going to see the long-term benefit? Is the A1C, which really is the marker that you want to bring down with diabetes -- weight loss is a great benefit. A1C control is the goal. Diabetes control is the goal. Type two diabetes reversal is possible with these drugs.  

And so, if you are an adult and you're of a certain age and you're struggling with type two diabetes, it's got all kinds of other negative life impacts. If these drugs have the potential to save your life or to significantly improve the quality of your life, then why wouldn't we pay for them? But what are we dealing with as far as adherence and things like that. And so we started to ask ourselves questions when Trulicity was our top GLP-1, and that was a big deal. And we talked a lot about it, and we tried to figure out some ways to address it, and we felt like we had that under control.  

And then what happened? 2017, Ozempic hit. And when Ozempic first dropped, you didn't really see the impact of Ozempic to spend. But once you started to hear some of the Hollywood folks talk about using Ozempic and getting it from their plastic surgeons, or going up to Canada and buying up the supply because, you know, they could do that, then it started to really explode and it became less of a let's control diabetes, let's get these A1C numbers down, and more of a cosmetic, let's lose 10-15% of our body weight, which is a great benefit.  

And weight loss can be a significant contributor to positive health outcomes. I don't want anyone who's listening to this, or who reads the article, to think that I hate GLP-1s and that I don't think that they should be used. I just think that we should be careful, and we should be measured in how we allow these drugs to be covered and whether or not we are covering them as plan sponsors, as fiduciaries for weight loss, without considering other qualifying factors.

[07:38] Justin Venneri: Got it. That makes a ton of sense, especially from a perspective of someone that may be sitting there thinking about, how do I do the right thing for my employees, you know, the beneficiaries of my plan and their dependents, but also for the plan, more broadly, and also in doing all of the right things, taking into consideration the actual label for the drug and what they're approved for.

[08:01] Bridget Mulvenna: And there's a lot of buzz about what they can do. But the reality is certain of these agents have only been approved for type two diabetes, and some of the agents have been approved for weight loss, and one of the agents has also been approved for cardiovascular improvement. Let's also look at the fact that recently there was information that there's a potential new use for the prevention of chronic kidney disease.  

These are all positive things that can impact outcomes and patients' lives and quality, quantity of life. However, if you're a plan sponsor and you're trying to keep premiums low and employees happy, if you're an ERISA plan and you're considering all of these different elements and keeping your benefit fair and equitable for everyone, then these are things that you need to be thinking about as a fiduciary.

[09:02] Justin Venneri: Okay? And this next question. Given what you said earlier, and that response, may seem silly to some folks out there, but could you maybe dig in a little bit more and explain why this is so unique? I mean, projections are all over the map for how much revenue these GLP-1s could drive for the manufacturers. But all over the map is usually like up and to the right, using Wall Street speak, in this case. And so, I'm trying to get at why as a plan sponsor, this is unique and why a plan sponsor may or may not be more or less concerned about high utilization of a particular class of drugs. I know the price tag plays a huge part, but are there any analogs or any other factors that influence the decision here?

[09:47] Bridget Mulvenna: Well, sure. I mean, if you see GLP-1 utilization climbing and that impacts your entire anti-diabetic class, which for most plans is the highest spend drug class. Let's face it, in America, we aren't the healthiest. You know, we have been subjected to our standard American diet. And that has created an overwhelming issue with obesity and weight issues and late onset of adult diabetes, which, let's face it, type two diabetes is that type of diabetes. And so, you're concerned with high utilization in a class like this as a plan sponsor at first blush, because you wonder about the health of your population. Is it getting worse?  

So, then you want to think, okay, so do we allow this so that potentially the health can get better, we can reduce cardiovascular events, we can help reverse chronic kidney disease and type two diabetes? That's all great, but there are other factors with patients. These are mostly injectable medications. There's only one agent right now that's on the market that's fully approved by the FDA. That is an oral GLP-1 agonist. It's called Rybelsus. It doesn't have as many positive weight loss benefits as some of the other GLP-1s. But I think that when we're looking at this from a plan sponsor perspective, we're thinking about patients. We're thinking about our members. We're thinking about the people that work for us and their families, and are they healthy? Are they getting the benefit? Are they compliant? Are they adherent? Are the drugs that we're paying for as a plan actually benefiting the members and potentially creating this scenario where there is a cure or a reversal for this disease state that has really floated up to the top? I think I read somewhere recently, and please don't quote me on this, but 47% of Americans are overweight or obese.

[12:01] Justin Venneri: We're going to quote you on that. I think that's the right stat lately.

[12:05] Bridget Mulvenna: I read that recently, but, you know, I read a lot, and some of it is about work and some of it is fun. So, it kind of all gets mixed up in there.

[12:16] Justin Venneri: No, it's very relevant. I mean, certainly appreciate the overarching health risk of, you know, an unhealthy diet and not getting enough exercise. And it's interesting because those are a -- it's not really an aside -- those are part of a label for the GLP-1s, like should be, you know, taken with diet and exercise. I'm not a clinician. I know you're not a clinician either. But keeping it sort of at that business and plan sponsor level, given what you said earlier about GLP-1s often being first line or they can be for diabetes, and then now we have weight loss, and you mentioned cardiovascular risk. Can you walk us through your suggestions to help manage or be more aware of the spend trend here as it relates to GLP-1s as part of the overall pharmacy spend?

[13:03] Bridget Mulvenna: Well, I'm going to start with something that is not in the article that I wrote, but it's in my mind because I'm writing another article.

[13:10] Justin Venneri: Okay, that's great.

[13:11] Bridget Mulvenna: That is, you need, as a plan sponsor, you have to have access to your data. You need to look at your data. You need to understand your data. You need to understand that diabetics are possibly your top class and then what percentage of each of these drugs is being used, and then break it out so that you can see if there is possibly an issue with adherence. Okay, so I just threw that out there as my little softball.  

The other big thing that I think folks need to do as a plan sponsor is work with your pharmacy benefits manager so that you have a full and complete understanding of the prior authorization process. You may not be able to change it or make it more strict or harder just because there are negative impacts to the finances if you do that. Potentially. But you want to know what the PBM has in place to protect you from erroneous prescribing. And erroneous prescribing is, I'm a patient, I go into the doctor and say, I know I don't have type two diabetes, but I want to lose 40 pounds. Can you put me on Ozempic? The doctor goes, sure, I'll put you on Ozempic, but I'm going to have to tell a little white lie that you have type two diabetes.  

Now, I'm not accusing doctors of doing that, but I can foresee a place where that happens. We talked about this in the last podcast. We need to always remember, patients are healthcare consumers. Doctors are taking care of their patients and their customers at the same time. So, doctors are going to do what they need to so that their patients are happy and well.  

You can also look into one of the myriad third party point solutions that are out there that help with coaching. And as someone who has been a lifetime exerciser, what I can say to you is that I always do better when I have a coach. I do better on any sort of diet, or exercise, or lifestyle change plan when I have a coach and a partner. And that is what these solutions provide. They provide some oversight, some counseling, some help with adherence, but at their core, they are a healthcare coach. And we could all use that, right? Every once in a while we could all use the healthcare coach.

[15:49] Justin Venneri: I think so.

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[15:50] Bridget Mulvenna: And then try to limit waste. And one of the ways that you limit waste with GLP-1s is just because they fall into this anti-diabetic class and they are a “maintenance” -- I'm air quoting here -- maintenance medication doesn't mean that we should be dispensing a 90-day supply on this.  

I believe that these are injectable drugs. They come in different strengths and forms, and you figure out what your dosage is, and that dose can titrate up and down over time. And so over dispensing can be a huge cost generator here. And if you pull back on that over dispensing and allow a 30-day supply at a time, your members still get their drug. They're not not getting their drug, but you're limiting the amount of drug that they have in case, you know, if I took it for two weeks and I was sick all the time, I would probably not want to take it anymore. And I wouldn't want to be, as a plan sponsor, I would know that there are people in that scenario. I wouldn't want the thought of a 60-day or a 75-day supply of the medication ending up in somebody's refrigerator or their junk drawer in their house and not being ever used at the tune of $1,500 a shot. Right?

[17:17] Justin Venneri: It's expensive. Right. I mean, I think the. What's the gross or list price? I think I hear $1,300 plus or minus all the time. And the net is obviously going to be different based on rebates, which is the potential financial implications you alluded to earlier. I think that's what's interesting about the label and going back to that, but also education in this context as a plan sponsor, how do you ensure that you handicap, for lack of a better way of asking it, the financial impact versus the member potential for member disruption and ensuring that the members are educated about, if you choose to cover these, why you're covering them.

[17:56] Bridget Mulvenna: I think you have to tell them the truth. Like, you know, we see that this is something that you want, we're going to cover it. Here are the rules. You can definitely do that as a plan sponsor as long as you do the same thing for everybody under the plan. Right? As long as you're not treating any one group differently or special.  

I also think in the journey to managing this with employees and managing the spend, plan sponsors have to make the decision -- are we only going to cover this for diabetes or are we going to open it up -- to be prepared for snowballing spend in the anti-diabetic class and on your pharmacy spend if you open it up. But also there potentially are long term health benefits.  

There is this consensus out in the medical space right now that maybe in some ways this is a miracle drug, and I hate to use that, but it has the potential to end the phenomenon of craving. And that to me makes it a really powerful drug. But it also makes it scary because you're going to be spending this money and you're not going to have the visibility that you would have in a normal healthcare setting to see if it's actually working. How often do patients or members call back into the plan and say, thank you for covering my drug, I've lost 45 pounds and kept it off for two years. Nobody ever tells you that stuff.  

And so, the long-term impact of the potential healthcare savings is unknown. I believe that it's possible that that's going to happen, that it's going to save money in a lot of different ways in the medical space. But it's really scary right now because pharmacy used to be 5% of plan sponsors’ total spend. It's now pushing 50%. That is scary.

[20:13] Justin Venneri: It's definitely grown a lot.

[20:16] Bridget Mulvenna: When that is half of your expense. That's scary. And because it's also a category that most plan sponsors are uneducated on and don't understand,  

[20:26] Justin Venneri: This might seem like a question too, because it's math. Does the size of the plan matter a lot here? Because it seems if you've got 50,000 or 100,000 members versus 2,000 or 3,000 members or less, does that impact your decision tree?

[20:41] Bridget Mulvenna: Well, I mean, if you think about the fact that if you've got 2,000 members or less, one or two people can really make a difference in your drug spend in a year, right. And like, one person with a cancer diagnosis can crush a plan that size. When you're larger, you tend to have a larger pool of funds to draw from, and you. You've got more employees and they're paying more premiums, and the law of averages starts to work for you.  

However, with the volume of drugs that we're seeing get dispensed in this class, it can still significantly impact drug spend. And my recommendation is that if you are -- one of my recommendations that we didn't get to yet -- if you're a plan sponsor and you are going to cover for weight loss, to potentially look into implementing a coinsurance of about 30% to offset the cost of the drug a little bit more for the plan to get the member a little bit more engaged in their weight loss journey because they've got more financial skin in the game. And then educate those folks. Like, if they want to be in one of the point solutions, that's great. One of the things the point solutions can do is educate.  

But you've said it a couple of times about the label. The labels of these drugs are very, very clear. They are not touted as miracle drugs. They are not sold as miracle drugs. They are sold as an additional tool in your toolbox in addition to effective diet and exercise, so that you can get to a healthy weight. And you have to maintain the new lifestyle as you titrate off the medication so that you don't rebound. Because it is an artificial -- you know, GLP-1 is something that all of our bodies make. You know, we, over time, destroy the body's ability to make that through lifestyle and behavior. This is replacing that natural GLP-1 with an analog and an artificial type of peptide that is going to help your body produce more GLP-1. And that kind of shuts your hunger off. Well, once you stop taking it, your body stops making it.

[23:07] Justin Venneri: Yeah, I think a lot of the data show that, right. It says people regain the weight pretty darn quickly once they stop.

[23:14] Bridget Mulvenna: If they aren't effectively titrated off. And look, it's. It's hard. My prediction with this drug class is, I would say strap in. It's gonna be a rollercoaster. And as more and more of these drugs come out and as more of these clinical trials -- like I said, like, there's 61 phase one trials right now. As these get into phase two and phase three, I would not be surprised, especially because the average age of these clinical trials is not 40. It's closer to 64. And that's been pretty standard.

[23:50] Justin Venneri: That's interesting. You mean of the clinical trial participant?

[23:54] Bridget Mulvenna: Yeah, it's a relatively older population. And what I think we're going to start to see is more and more indications, there's early indications that there's going to be some sort of menopause weight gain benefit here with a low dose and the ability to stop the phenomenon of craving with alcohol and certain other illicit drugs. And so I think that we just need to be mindful, we need to stay vigilant, and we need to kind of watch what's going on in this space so that we can be prepared.

[24:29] Justin Venneri: So, we've got plan sponsors need to get their data, understand their data, really dig in. You understand your population. And that's why it's a very, quote unquote, personal decision to cover these. Look at the role third parties point solutions can play in helping with education, coaching, et cetera. Limit waste so day supply, just ensure adherence to the extent you can and then skin in the game via coinsurance. Fair summary?

[24:58] Bridget Mulvenna: I would say that was a pretty good one.

[25:00] Justin Venneri: Awesome. So, before we end, and we'll keep it to GLP-1s this time, thank you, Bridget, so much for. For sharing your thoughts with us here so far. And I look forward to what the answer to this one is. The most astonishing thing you've seen relating to GLP-1 since you've started talking about them more. Would love to hear a story or just something that's really caught your eye or is interesting astonishing, or everybody really needs to pay attention to, related to GLP-1s.

[25:28] Bridget Mulvenna: Well, astonishing is a great word. I am absolutely astonished by all of the non-traditional methods by which you can get a GLP-1 in the world. If you can afford it, you can get pharmaceutically compounded semaglutide and tirzepatide if you want, because they're on the FDA shortlist, and so other pharmacies can manufacture the generic version of them because they are in such short supply. And I've seen beauty salons, spas, plastic surgeons, and other very non-traditional methods for folks to get this medication pop up. And I'm astonished by that because the fact that that's allowed in our current healthcare ecosystem is a little scary. And I worry about what's going to happen to these folks if they take these. They're not in a situation where they're being closely monitored by their actual physician. They're getting them from a beauty salon, you know, and I wouldn't even get my Botox from a beauty salon. Right?  

I really think that we should be very careful as a country and as plan sponsors and fiduciaries about allowing our members or not counseling our members and educating our members on the potential health impacts that that could have. Because if you take Ozempic and you have a side effect, you know, you can stop and you can talk to your doctor. If you're taking these and you have side effects, you may not have the resources that you need to get your health addressed. And it could potentially cause significant health impacts that cost plan sponsors lots of money down the line. So, I just really feel like it's a non-traditional type answer. It's not a great, like, feel good story, but it's sort of a cautionary, astonishing story.

[27:33] Justin Venneri: And that sounds like lots of questions around cosmetic use there, is what I'm hearing.  

[27:40] Bridget Mulvenna: Yeah. And I'll tell you that when I first started to see GLP-1 utilization rise in the plan, when I was the pharmacy director, I looked very closely at the jump and I started to see a shift. The shift from the older GLP-1s that have less weight loss benefit to the newer ones that do have weight loss benefit is a real thing. And that's another thing I think folks could be looking at. It's, we live in the GLP-1 world, and it is now our job to manage it.

[28:14] Justin Venneri: That's a great place to stop because we could definitely go on longer here. Bridget, thank you so much for joining us again, sharing your thoughts on GLP-1s and how to manage that spend, and think about the future with a lot more indications, potentially, and a lot more agents.

[28:28] Bridget Mulvenna: Yeah, future is wide open.

[28:31] Justin Venneri: Have a great rest of your day.

[28:33] Bridget Mulvenna: All right, you too. Thanks.

If you would like to learn more about Capital Rx’s full-service PBM or PBA solutions, including our clinical programs, CLICK HERE to get in touch with our team.

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