Rise of Speciality Drugs

At the 2017 Business Insurance/CLM Annual Conference, a panel discussed the rise of specialty drugs, including anti-virals such as Truvada, Combivir and Kaletra, and how they are utilized in workers’ compensation claims. The panel included:

• Heather Carbone – Attorney, Boyd and Jenerette P.A.
• Kimberly Simmons – Property and Casualty Claims – Fidelity National Financial
• Martine Cumbermack – Attorney, Swift Currie McGhee Hiers LLP

In 1990, there were only 10 specialty drugs on the market, mostly to treat rheumatoid arthritis, multiple sclerosis, cancer and growth disorders. By 2012, there were nearly 300 specialty drugs – and that number has continued to rise. While specialty drugs represent less than 1% of all medications, specialty drugs are expected to represent 45% of all pharmacy sales this year. These drugs are having an increased impact on healthcare costs because they are so expensive.

Specialty drugs address needs of patients that are either non-responsive to other therapies or patients with conditions for which there were not treatment options in the past. These drugs are more expensive to develop, get approved, administer and deliver, which translates to significantly higher costs. Administration of certain special drugs are performed by the providers office, meaning the bills are coming from the physician or hospital. The average specialty drug costs $1,200 a month, but can range from $500-$2,500 a month.

Specialty Drugs in Workers’ Compensation:

• The types of conditions treated with specialty drugs that we could see in workers’ compensation include cancers, HIV or Hepatitis C caused by a needle stick and spinal cord injuries,
• Anticoagulants, which are used after surgery to prevent blood clots, can at times be specialty drugs. Without preventative treatment, the incidence of DVT is 40-60-% higher in patients undergoing major orthopedic surgery.
• Antiviral medications can be seen in cases where healthcare workers or first responders were exposed to the HIV virus to prevent the disease from developing.
• Biological agents (immune suppressants) are used to treat rheumatoid arthritis by suppressing certain areas of the immune system. There are studies that show physical trauma could lead to the onset of rheumatoid arthritis.
• Viscosupplementation has been shown to relieve joint pain in patients that have not responded to other non-surgical methods. For instance, a thick solution called Hyaluronate is injected into the knee joint creating an artificial lubricant in that joint.

Some feel that eventually specialty drugs will ultimately lower system costs because they can modify the course for a chronic disease. On the flip side, if patients end up needing to take these high-cost drugs for a lifetime, the costs could increase significantly.