The federal government recently eliminated supplemental provider fees it provided under the Medicare program to obtain intravenous immunoglobulin therapies (IVIG) , citing “stability in the market.” But safety-net hospitals have a different experience; they say it’s becoming increasingly difficult to access the widely used blood products at 340B pricing.
A small, but revealing electronic survey conducted late 2008 by Safety Net Hospitals for Pharmaceutical Access (SNHPA) echoes findings from a 2006 study and raises questions about whether manufacturers and specialty distributors are complying with the 340 law.
The new survey showed that a vast majority of the hospitals responding to the question of availability (35 of 36 respondents) had been unable to obtain IVIG products from their wholesalers at 340B prices. One hospital reported that the products obtained covered only 3 percent of its needs. Just 30 percent of products purchased from sources other than the wholesaler were filled at 340B prices, this hospital said.
“The financial impact has been extremely challenging,” said Sherry Osborne, director of pharmacy at Jackson-Madison County General Hospital in Jackson, Tenn. “And with more physicians not getting reimbursed in their clinic settings, they’re sending their IVIG patients to the public hospitals. We try to save everywhere we can to compensate for this.”
IVIG products, used over the last 50 years primarily to treat immunodeficiency disorders, are derived from human blood plasma. The fact that discounted IVIG products are difficult to find is concerning because autoimmune disorders are on the rise, and IVIG therapies – with their anti-infective, immunoregulatory and anti-inflammatory properties – are often the first line of defense.
Studies have also identified IVIG therapies as an effective off-label treatment for multiple sclerosis, certain transplant rejections, Guillain-Barre syndrome, the progression of HIV, and the prevention of some types of miscarriage. Such findings have driven up IVIG utilization.
Nothing in Writing
The IVIG products most often sought by the 340B providers participating in the survey were Gammagard powder and liquid, Gamunex, Flebogamma, Carimune, and Octagam. The products hospitals had most difficulty obtaining were Gamunex, Carimune, and Flebogamma.
Gammagard is manufactured by Baxter, Gammunex by Talecris, Flebogamma by Grifols, and Carimune by CSL Behring. All four manufacturers participate in the 340B program, though their numbers may be shrinking.
CSL Behring announced last year that it will acquire Talecris for $3.1 billion and the merger is currently going through regulatory review. There is some concern within the 340B community that the combination of two large IVIG manufacturers could drive up prices and further hamper access to IVIG products at 340B prices, a matter the Federal Trade Commission will likely review.
In most cases, wholesalers told hospitals that the product was not allocated by manufacturers for 340B purchase, or that the allocation for 340B pricing had been depleted.
Thirty-seven percent of the survey respondents said they had discussed their concerns about IVIG access or pricing with manufacturers. Manufacturers universally blamed shortages, with no or a limited 340B allocation for the drug requested, the hospitals reported. As with the wholesalers, no manufacturer provided written responses to the hospital inquiries; all responses were verbal.
This mirrored the situation in 2006, and raises additional questions over why drug makers would not explain in writing why there’s no 340B pricing.
One survey respondent questioned the manufacturers’ plea of shortages, noting that the products are never listed on the Food and Drug Administration Web site as under “shortage.” Indeed, the Centers for Medicare and Medicaid Services recently eliminated a separate reimbursement fee authorized for IVIG products, which reimbursed healthcare providers for efforts expended in obtaining scarce IVIG products, because it concluded that “the IVIG market today appears more stable than it was in CY 2006.”
Treatment delayed, hospitals scramble
Fifty-six percent of hospitals completing the SNHPA survey said they were able to get at least some IVIG from their wholesalers at non-340B prices, but that response rate constituted a 12-percent point drop from the 68 percent who said they could do so in 2006.
On the other hand, of those who said they could obtain product at non-340B prices, 80 percent said the quantity was sufficient to meet their needs, an increase of 30 percentage points over 2006. The two manufacturers reported to be willing to provide their product directly, on request, to 340B providers at non-340B prices were Baxter and Talecris.
Reported demand for the product varied considerably from hospital to hospital, ranging from 50 grams to 4,300 grams per month for inpatient use and from 50 grams to 8,000 grams per month for outpatient use.
A couple of respondent said the difficulties in obtaining IVIG products has meant that outpatient appointments frequently have to be rescheduled and inpatients often have to wait several days for an infusion.
About 40 percent of respondents said the shortage has had a significant impact on hospital finances. The University Medical Center in Tucson, Ariz., for example, estimated it’s been spending almost $40,000 more per year on IVIG products because of its inability to procure IVIG at 340B prices.
The hospital’s outpatient oncology facility had to switch from Gammagard to Flebogamma, because the latter costs $2 less per gram at non-340B prices, said Paul Castro, the hospital’s business manager for pharmacy services. Even so, he said, IVIG procurement costs are directly affecting hospital operations.
“We’d like to open a retail pharmacy at one of our oncology centers so that patients don’t have to drive across town to get their outpatient scripts filled,” Castro said. “But the extra cost of Flebo hinders our ability to invest the capital.”
Uncertain market
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IVIG products most difficult to obtain at 340B prices Gamunex (Talecris) Source: SNHPA IVIG survey, 2008 |
Only 13 percent of hospitals participating in the survey said they expect the supply of IVIG to improve over the next few years, while 39 percent said they expect supply to deteriorate. Forty-eight percent said they expect it to remain unchanged. Many declined to guess.
“The market is too unstable at this point to anticipate what will happen,” said Toni Armijo, pharmacy purchasing technician at the University of New Mexico Health Sciences Center in Albuquerque, N.M.