Trends in Specialty Drug Approvals & Management: A Look at 2021 & 2022
The continuous advancements in technology have revolutionized drug discovery and development and have significantly expanded our ability to treat and even cure complex diseases. Consequently, there has been a notable shift in drug approvals from traditional drugs to specialty drugs. But what exactly are specialty drugs, and why should we pay attention to them?
What is a specialty drug?
Specialty drugs do not have a universally standardized definition and can vary depending on the perspective of stakeholders in the drug supply chain. This lack of consensus has led to confusion and, in some cases, increased costs for plan sponsors. However, there are generally agreed-upon attributes that define specialty drugs, including:
Biologic and complex molecules
Indicated for rare, complex, and/or chronic diseases
Require special handling, distribution, storage, and administration
May require administration by a healthcare provider
Associated with high cost, typically $1500 or more per month supply
Why Specialty Drugs Matter?
2021 & 2022 FDA Drug Approvals: Traditional vs. Specialty
While specialty drugs account for only 2-4% of total annual drug utilization for most payers, they contribute to an estimated 56% or more of the total drug expenditure. In the past decade, the FDA has been approving an increasing number of specialty drugs each year, and this trend is expected to continue. For instance, in 2021 and 2022, the FDA approved a total of 87 drugs, with 76 of them classified as specialty drugs.
Contact Axum for complete list of specialty drug approvals.
The ongoing growth in specialty drug approvals brings innovative and life-saving therapies to patients. However, effectively managing these drugs has proven to be a challenge for many plan sponsors. The complexity of specialty drugs poses difficulties in understanding and navigating their management for many plan sponsors. Over the years, plan sponsors have encountered several key challenges in managing specialty drugs, including:
Siloed & ineffective clinical management
Economic management muddled with conflict of interest, lack of transparency & information asymmetry
Misalignment between vendors and plan sponsors
Additionally, unlike traditional drugs that are typically covered under the pharmacy benefit, specialty drugs fall under both the pharmacy and medical benefits. While plan sponsors are familiar with managing specialty drugs under the pharmacy benefit, they have been slower in implementing strategies to address the growing management needs under the medical benefit.
Employers and plan sponsors can no longer afford to overlook the need for a comprehensive specialty drug management strategy under the medical side of benefit. The management of specialty drugs under the medical benefit not only presents significant opportunities for improving patient care but also offers substantial potential for cost savings. It is imperative that plan sponsors recognize and address these opportunities without delay.
As the number of specialty drugs has increased, so has their share within the medical benefit. In 2020, 15 out of 36 specialty drugs approved were covered under the medical benefit. Similarly, in 2021 and 2022, 38 out of the 76 specialty drugs approved were covered under the medical benefit. Thus, having a comprehensive approach to specialty drug management across both pharmacy and medical benefits is crucial.
Trends in FDA Drug Approvals, 2021 & 2022
Specialty Drug Management Reimagined with Axum Rx
Axum Rx has an innovative Specialty Drug Management Ecosystem that addresses critical gaps in specialty drug management through the integration of decades of industry expertise, benefits management strategy, clinical knowledge, and cutting-edge technology solutions. The Axum Rx Specialty Drug Ecosystem is designed to deliver three fundamental value systems in specialty drug management:
Clinical value
Economic value
Alignment value
Above all, Axum Rx has reimagined and simplified the archaically convoluted specialty drug management paradigm by putting the interest of clients at the forefront of everything. By removing all of the conflicts and misalignments, Axum Rx focuses on what truly matters. Helping patients get access to the right drug therapy at the right time to improve measurable patient outcomes, enhance consumer experience and achieve the financial objectives of key stakeholders. This is the Axum promise.