Medication Shortages Impact Patients and Payers

Plan sponsors must address the impact of medication shortages as they plan for the future.

In September 2023, I published a blog commenting on the release of generic Vyvanse as a positive market change for driving down plan costs and increasing patient access. However, uptake has been slow, reflecting a narrative all too well-known to those prescribed ADHD medication over the last several years: medication shortages. In this blog, I’ll discuss several areas where medication shortages are impacting patients and payers, particularly for ADHD, oncology, and GLP-1 medications.

Ongoing ADHD Drug Shortages

Generic versions of Adderall and Vyvanse, which are two of the most prescribed medications for attention deficit hyperactivity disorder (ADHD) treatment, continue to be listed on the ASHP drug shortage database. Inconsistent supply at pharmacies throughout the country has led to patient frustrations and delays in access to care. Moreover, stimulants are considered Schedule II-controlled substances under federal law, which limits prescribers’ flexibility in prescribing multiple medications and places limits on the quantity that a pharmacy can stock and dispense.

The shortage of stimulants can be mainly attributed to the increased demand and accessibility that began during the COVID-19 pandemic. Telehealth regulations for prescribing ADHD medications were temporarily eased, which led to a surge in demand.

The Drug Enforcement Agency (DEA), Food and Drug Administration (FDA), and drug manufacturers have continued to trade blame on who is ultimately responsible. Back in November, the DEA published an open letter addressed to the American public outlining specific steps the agency would be taking to ease shortages. It included shifting quota allotments to quarterly instead of yearly and increasing reporting requirements. However, these changes did not have an immediate impact. There may be a light at the end of the tunnel as top manufacturer Teva was recently removed from the shortage list. Nevertheless, patients continue to face supply challenges and have sought guidance from clinicians, PBMs, plan sponsors, and HR departments to help obtain ADHD medications.

Cancer Therapy Shortages

Cancer medications and antibiotics have also fallen victim to shortages recently, and prescribers have been forced to ration or adjust time-sensitive treatment. Carboplatin and cisplatin, two highly effective and inexpensive chemotherapy medications, are in short supply posing a challenge for United States hospitals in delivering lifesaving cancer care.

The shortage can be traced back to late 2022 when the production facility responsible for over half of the United States cisplatin supply was abruptly shut down by inspectors. Even amoxicillin, one of the most commonly prescribed antibiotics, is in short supply, leaving parents scrambling at the pharmacy counter for their children at a time when community pharmacies are becoming less accessible. One begs the question – why can’t we solve the drug supply problem in the US, especially for generics?

Mark Cuban’s Cost Plus Drugs company has attempted to fill the void by opening a manufacturing facility in March that will supply hospitals, but larger-scale solutions are necessary. Multiple proposals are sitting in the hands of legislators, and the most recent “Drug Shortage Prevention and Mitigation Act” has bipartisan support. It is a critical time to invest in solutions that boost supply stability.

The Rise of GLP-1 Medications

Shortages have not been limited to generics. The increasing popularity of FDA-approved GLP-1 medications has caused supply chain disruptions for patients with type 2 diabetes and those seeking obesity treatment. Their positive effects on weight loss and increased notoriety have led to demand that far exceeds supply. While manufacturers Eli Lilly and Novo Nordisk have committed to increasing supply and have invested in additional facilities, these actions are meant to address the long-term demand, and patients continue to have difficulty consistently accessing Mounjaro, Ozempic, Wegovy, and Zepbound.

Plan sponsors are facing the challenge of managing increasing cost trends and long-term demand forecasting. This includes ongoing research with the potential for expanded GLP-1 indications to cover conditions like sleep apnea and kidney disease, while also having to account for supply issues impacting pharmacy claims. Self-funded employers must develop budgets and make plan design changes to ensure benefits are properly funded, yet supply issues may be masking the true demand. This could be especially relevant for obesity treatment, where supply issues have led to an explosion of compounding pharmacies attempting to fill the demand gap, with one Digital Health company offering a commercialized compounded version at a large discount off current branded products.

Due to ongoing shortages, PBM-owned mail-order pharmacies have been unable to fulfill or even stopped supplying certain GLP-1 products for obesity and diabetes. This could potentially increase costs for many plan sponsors because of less favorable guaranteed pricing at retail, which is typical of most PBM contracts.

Plan Sponsor Considerations for Responding to Medication Shortages

There are several considerations for plan sponsors when it comes to medication shortages. It is necessary to work closely with your PBM and vendors to communicate plan design changes to members in a timely and effective manner. Ensuring account teams regularly provide updates to benefit leaders and key health care stakeholders on impactful drug shortages is a valuable way to support this. Assessing the financial impact to the plan and the out-of-pocket cost to members as a result of supply shortages at PBM-owned mail-order pharmacies will be crucial to managing budget and minimizing disruption. Finally, it is critical to ensure formulary and network policies are aligned to reflect market changes, while consulting with clinical experts to confirm appropriate coverage for members is equally important.

At PSG, we provide strategic vendor oversight for our clients to ensure members are put first when drug shortages impact care. We ensure vendors provide transparency into supply changes and can implement formulary and plan design updates swiftly to preserve access while maintaining affordability. Our proprietary data and analytics tool, Artemetrx, leverages integrated medical and pharmacy data to provide deeper insights into claims data. Please reach out if you would like to learn more!