Care Mark

Hot Topics and Trends in
Prescription Drug Benefits
©2007 Caremark. All rights reserved. Reprint with written permission only.
Agenda
CVS Caremark Service Model
HAC’s Customer Service Results
HAC’s 2006 Performance
Specialty and Biogenerics
What to Expect in 2007 and Beyond
CVS Caremark
James Margiotta,
Senior Vice President,
Employer Sales and Account Services
Howard McLure,
Executive Vice President,
CVS Caremark Corporation and
President of Caremark Pharmacy Services
CVS Caremark Long-Term Vision
for Consumer Health Advocacy
Trusted healthcare providers and Real-time data connectivity and

advisors integration
Proven health advocacy and Actionable plans and personal
convenient local access coaching and feedback
Comprehensive financial Universal access through face-to-
connectivity and advocacy face interactions, telephonic, Web
Health plan integration and neutrality and portable digital technologies
Extensive physician support and Award winning e-health and
collaboration customer care centers
Creating health advocacy through personalization, access and connectivity

for your people… and consumers everywhere. 4
The CVS Caremark Difference
#1 in Consumer Access, Cost Savings, Quality and Service
Cost Savings Health Value
9 Efficient purchasing – 1 billion prescriptions annually 9 Health screening – easy access and integration
9 Generic substitution and formulary compliance 9 Vaccinations and immunizations
9 Early diagnosis and therapeutic intervention 9 Therapeutic intervention – iScribe® and PHR support
9 Reduced OTC costs and interaction monitoring 9 Wellness and lifestyle support (CVS distribution)
9 Affordable access for routine care (Minute Clinics) 9 Physician connectivity and support
9 Reduced use of inappropriate medications 9 Adherence interventions and DM recruitment
9 Improved compliance and adherence 9 Advance guideline management
9 Strategic channel flexibility (mail, retail, CVS) 9 Surgical complication avoidance
9 Specialty advanced guideline management 9 Health credentialing leadership
9 EBM – Disease management leadership
Consumer Engagement Operational

9 Convenient access (retail, mail, CVS, Minute Clinics, WEB) 9 #1 PBM in JD Power and Associates Customer service
survey ranking
9 Proactive planning and care path support
9 HBS – CVS case study in technology and process
9 Personalized information leveraged at Point-of-Care improvement innovation
9 Trusted advice from clinical providers 9 Consumer health information integration
9 CVS OTC and front of store discounts 9 Rule-based multi-channel proactive intervention
9 Aligned incentives (extra care, coupons, benefit design) 9 Extra care incentives and coupons
9 Consumer research (50 million active consumers) 9 eLoyalty behavioral analytics
9 Consumer interaction leadership 9 ePrescribing and physician connectivity
9 Physician interaction leadership 9 Health plan integration
9 Face-to-face counseling and consumer assistance 9 Analytics and outcomes support
9 Consistent execution across locations, channels and centers
5
Customer Service Results
Bob Eisendrath, Area Vice President,
HAC’s Consumer Research
Shows High Satisfaction
Survey Results
99%
96% 97% 97%

95%
93%
93%
90%
Overall Mail Service Customer Service Retail Pharmacy
Satisfaction Service
Annual survey sent to all HAC plan participants

Customized survey focusing on areas most important to
HAC members
All aspects of survey reviewed & validated by an
independent third party
Source: Caremark 2006 Plan Participant Satisfaction study 7
HAC’s Consumer Research –
Client Satisfaction Survey Results
Overall score – “very satisfied”
4.2 on a 5.0 point scale
Comments received by HAC clients:
“Account Executive always rates extremely high and her
performance never waivers.”
“Account Manager always goes above and beyond. She
doesn’t just fix the problem, but finds out why it happened
and how we can prevent it from occurring again.”
“Account Executive is a consummate professional. She is
the reason for my continued support of Caremark.”
“Account Manager is very knowledgeable. If she doesn’t
know the answer, she knows where to go within the
Caremark organization to get it and is always pleasant.”
Source: Caremark Client Satisfaction Survey, 2006 8
Caremark Makes It Easier for Consumers
to Navigate Solutions to Their Health Needs
Mail Service Pharmacies – ranked “Highest Customer Satisfaction
with Mail Order Pharmacies” by J.D. Power and Associates*
Convenience and simplicity of ordering
Timeliness in filling prescription orders
Ease of navigating Caremark.com, paper forms and phone
system
Customer Care Centers – certified by J.D. Power and Associates
for providing “An Outstanding Customer Service Experience”**
Process-efficient, professionally managed, focused on
providing the highest levels of customer service
* Caremark received the highest numerical score among mail order pharmacies in the proprietary J.D. Power and Associates 2007 Retail Pharmacy
Satisfaction StudySM. The study was based on 6,543 total responses, and measures 11 mail order pharmacy service providers. Proprietary study
results are based on experiences and perceptions of consumers surveyed during October to November, 2006. Your experiences may vary. Visit
www.jdpower.com for more information.
** For information about the J.D. Power and Associates Certified Call Center ProgramSM, visit www.jdpower.com. 9
HAC’s 2006
Performance and Key
Drivers of Trend
Laura Smith, Senior Strategic
Account Executive
Duyen Duong, Pharm D.,

Manager Analytical Consulting
Services
HAC’s Key Results
In 2006:
HAC’s total drug spend was $240M in 2006
4th year in a row of single digit trend (4.4%)
Performing better than the Caremark employer book of business
Key Drivers of Trend:
Generics reduced HAC’s spend by 4%
Positive impact on HAC’s low trend.
Mail utilization remains higher than benchmarks.
HAC continues to benefit from the mail distribution channel
- Deepest discounts and increased clinical management opportunities
Utilization is the biggest driver of HAC’s Trend
Accounts for 2.6% of Trend
Caremark solutions:
Leverage Caremark consumer tools to empowers plan participants to make
cost effective choices
iBenefitTM and www.caremark.com
Enhance your clinical management strategy to promote appropriate utilization
Specialty Guideline Management
Adherence to Care 11
Single Digit RX Trend Continues
Gross Trend
15.0%
11.1%
12.0% 9.3%
9.0% 7.9%
6.2% 5.5%
6.0% 4.5%
3.0% 0.7% 4.4%
0.0%
2003 2004 2005 2006
HAC CMX BOB
Key Drivers of HAC’s pharmacy trend management:

Proactive and innovative plan management strategies
Ongoing consultation from Caremark and HAC staff
Innovative and competitive pricing models
Best practice sharing within RX user group
Source: Caremark data, 2003-2006 12
Drug Trend: Price
HAC’s Price Trend = 0.8%
Factors Causing Drug Trend Changes Ways to Address Trend
Price Distribution channels and access

Inflation Personalized mailings
Product competition Consumer based feedback
Growing generic availability systems
New indications Education
Innovative plan designs
Generic uptake programs
Interactive Web tools
Preferred Drug List
Plan design
Source: Kaiser Family Foundation Cost Containment Strategies for Prescription Drugs: Assessing the Evidence in the Literature, March 2005. 13
Pharmacy Trend: Product
HAC’s Product Trend = 0.5%
Product
Formulary
Generic availability
Evidence-based medicine
Over-the-counter
Incentive-based plan designs
New drugs
Specialty drugs Member education
Demographics Consumer driven products

Benefit design ePrescribing
Pharmaceutical marketing practices Prescribing guideline adherence
Changes in prescribing guidelines
Source: Kaiser Family Foundation Cost Containment Strategies for Prescription Drugs: Assessing the Evidence in the Literature, March 2005. *Co-payment, coinsurance or co-pay
means the amount a plan participant is required to pay for a prescription in accordance with a plan which may be a deductible, a percentage of the prescription price, a fixed amount or
other charge, with the balance, if any, paid by the plan. 14
New Generic Launches
Key Driver of HAC’s Low Trend
Drivers of
GDR Improvement
Generic Dispensing Rates
Continued growth in
60%
generics
55% 54% Implementation of
55% innovative plan designs
51% 50%
50%
Alignment of member
47% incentives
45%
45% Improvements in Web tools
40%
Increases in generic
availability
2004 2005 2006
Outreach campaign
HAC CMX BOB
Source: Caremark data, 2004-2006 15
Therapeutic Generic Alternative Mailings:
New Approach to Increase Use of Generics
Alerts plan participants of generic
savings opportunities for select
single source brands through
personalized mailings
Highlights maximum annualized

Annualized savings at mail service
Savings
Communicates safety and quality of

generics and “generic alternatives”
Provides actionable steps

HAC mailings started in late 2006
Personalized
Report Message to
Physician
16
New Brand Products Continue to
Have Minimal Impact On Drug Mix
New Product Classes Average % of total Gross
Impact on 2006 Gross Caremark PMPM
per Day BOB Gross Trend
Cost Impact
2004 - 2006 New Endocrine, Antineoplastics, Antivirals, $4.14 5.2% 3.3%
Antidiabetics, Hypnotics,
Brand Products Anticonvulsants, Antihyperlipidemics,
Antidepressants, Antiasthmatic,
Psychotherapeutic and Neurological
Agents
2004 - 2006 New Cardiovascular Agents, Analgesics $2.31 5.5% - 1.7%
Generics Products And Anesthetics, Respiratory Agents,
Central Nervous System Drugs,
Endocrine And Metabolic Drugs,
Neuromuscular Drugs, Central
Nervous System Drugs
Source: Based on Caremark 2006 book of business data, Industry Analytics Feb 2007. New brand and generic products were identified by GPI code, based on actual release dates.
All trend calculations are based on a trend cohort group. Gross trend impact for new generic products summarizes the impact over brand and generic products within the New Generic
Product, GPI code list. 17
Pharmacy Trend: Utilization
HAC’s Utilization Trend = 2.6%
Utilization
Drug limitations: exclusions
New products Utilization management
Direct-to-consumer advertising Cost sharing
Aging population Consumer directed plans
Benefit design
Drug utilization review
More aggressive treatment
guidelines Physician education
Health management Preventative drug list
Over-the-counter availability Evidence-based medicine
Source: Kaiser Family Foundation Cost Containment Strategies for Prescription Drugs: Assessing the Evidence in the Literature, March 2005. 18
HAC’s Top 10 Therapeutic Classes
Account for 53% of Total Spend
Percentage Change Period-Over-Period
Cost Utilization Components
Utilization Drug Mix/Inflation Density of Use
Days' Supply/
Current Prior Total Total Days' Supply Gross Cost Utilizing Utilizing
Therapeutic Class Rank Rank Gross Cost Net Cost Gross PMPM PMPM per Day Members Member
Antihyperlipidemics 1 1 $24,771,476 $19,467,025 3.2% 3.9% -0.6% 3.7% 0.2%
Antidepressants 2 2 $18,038,402 $14,244,714 4.8% 3.8% 1.0% 1.9% 1.9%
Ulcer Drugs 3 3 $16,581,974 $13,187,101 1.5% 4.5% -2.8% 3.9% 0.5%
Antiasthmatic and Bronchodilator
Agents 4 5 $12,177,825 $9,673,804 10.5% 5.2% 5.1% 2.2% 2.9%
Antidiabetics 5 7 $11,452,788 $9,028,543 6.9% 5.1% 1.7% 5.1% 0.0%
Antihypertensives 6 4 $11,014,386 $7,092,485 -1.8% 1.2% -3.0% 3.1% -1.8%
Analgesics - Anti-Inflammatory 7 6 $10,074,381 $8,687,981 -6.5% -7.7% 1.3% -0.2% -7.5%
Endocrine and Metabolic Agents -
Misc. 8 8 $7,535,548 $6,436,076 -2.9% -7.8% 5.3% -3.7% -4.2%
Anticonvulsants 9 9 $7,246,648 $5,995,203 16.0% 7.5% 7.9% 10.6% -2.8%
Psychotherapeutic and Neurological
Agents - Misc. 10 10 $7,133,134 $6,597,800 18.1% 3.0% 14.7% 29.2% -20.3%
Utilization in these top 10 therapeutic classes account

for 53% of HAC’s total spend
Source: Caremark data, 2006 19
Top 10 Specialty Classes Account
for 11% of Total Drug Spend
Total % Biotech/ Total % Change Total Gross

Gross Specialty Utilizing in Utilizing Cost Per % Change in
Biotech/Specialty Class Cost* Gross Cost Members Members Utilizer Prescriptions
Rheumatoid Arthritis $6,107,652 22.4% 491 18.0% $12,439 26.1%
Multiple Sclerosis $5,756,936 21.1% 413 16.0% $13,939 22.5%
Oncology $2,536,696 9.3% 261 15.0% $9,719 18.5%
Transplant $2,129,351 7.8% 645 5.9% $3,301 14.8%
Human Growth Hormone $1,858,412 6.8% 83 6.4% $22,391 -5.3%
Hematopoietics $1,440,088 5.3% 174 -9.4% $8,276 0.4%
Hepatitis C $1,340,349 4.9% 88 3.5% $15,231 33.9%
Hemophilia $885,867 3.3% 13 44.4% $68,144 23.1%
Lysosomal Storage Disorder $736,810 2.7% 3 50.0% $245,603 -5.1%
Asthma $579,478 2.1% 46 21.1% $12,597 19.4%
Utilization in these top 10 specialty therapeutic classes account

for 86% of HAC’s total specialty spend
Source: Caremark data, 2006. Specialty drugs are based on the Universal Specialty Drug List. 20
A Small Percentage of the Population
Drives a Disproportionate Amount of Spend
Specialty Pharmacy Trends
30.0%
25.0%
21.7% 19.7%
20.0% 16.1%
15.7%
15.0%
10.4% 11.4%
8.1% 9.1%
10.0%
5.0% 1.1% 1.1% 1.2%
0.8%
0.0%
HAC 2005 CMX BOB 2005 HAC 2006 CMX BOB 2006
% Members % Total Spend % Gross Trend
Source: Caremark data, 2006. 21
Specialty Cost and Utilization Metrics
Metrics HAC Book of Business
% of RXs 0.4% 0.4%
% of Plan 1.1% 1.2%

Participants
% of Total Spend 11.4% 9.1%
% Plan Participant 3.3% 3.2%

Cost Share
Gross Trend 15.7% 16.1%
Gross PMPM $6.60 $6.91
Net PMPM $5.52 $5.91

22
Source: Caremark data, 2006.
Caremark is the
Premier Specialty Provider
HA
C
Medication Utilization Health

1st in the Business – 1978
Management Management Management
1st to Integrated Specialty & 9Pharmacy care 9Specialty 9Rare condition

PBM – 1997 management Network management
Management
9Distribution
1st to Administer Medicare Part D services 9Specialty
Specialty Program 9Plan participant
utilization
management
education and
JCAHO Accreditation since 1988 support
programs - AGM
9 Formulary and
Broadest Medication Offering preferred
product
management
Nationwide Network of 72
9 Medical Benefit
Pharmacies
Management
23
Case Study:
Treating the Whole Person
In a Multiple Sclerosis Costs related to Copaxone® Therapy for
study, direct medical MS by Pharmacy Delivery System
costs per day were 300
significantly lower for Caremark 256.98
235.15
plan participants whose 250 Other
drugs were dispensed 200
through Caremark
150
100
41.93
50 26.61 21.83
15.32
0
Prescription Direct Total Healthcare
Source: Marks, AS., Johnson, KE. Multiple Sclerosis: Compliance to Costs Medical Costs
Copaxone Therapy. International Society for Pharmacoeconomics and
Outcomes Research (ISPOR) 7th Annual International Meeting, May 19-22,
2002, Arlington, Virginia, USA. Value in Health. 2002 May-Jun; 5(3): 272-273. Costs per plan participant per day
Definitions: Pharmacy delivery systems were categorized as Caremark or non-Caremark (other).
Total health care costs were calculated as the sum of prescription costs and direct medical costs.
This page contains prescription brand name drugs that are trademarks or registered trademarks of pharmaceutical manufacturers that are not affiliated with Caremark.
24
Innovative Clinical Management Strategy
Implementing Specialty Interventions to Drive
Appropriate Utilization and Adherence
12 Month Performance (Review for 28 Clients)
2723 2780
1283 1292
821 824
57 9 3
Initial Review Re-authorization Overall

Met Guidelines - Approved 2723 57 2780
Did Not Meet Guidelines - 1283 9 1292
Not Treated
Did Not Meet Guidelines -
Approved After Appeal 821 3 824
Client’s Specialty Drug Spend $27.8M

Avoided Drug Cost - Initial Review ($8.5)M
Avoided Drug Cost - Re-Certification Review ($0.2)M
Total Avoided Drug Cost ($8.7)M

Trend Avoidance 31%
25
Opportunities to Target Behaviors:
Improving Suboptimal Adherence
HAC’s Adherence Results
Optimal Adherence (MPR >=80%) Suboptimal Adherence (MPR <80%)
MPR= Medication Possession Ratio

Source: Caremark Data, 2006 26
What to Expect in
2007 and Beyond
Duyen Duong, Pharm D., Manager
Analytical Consulting Services
Bruce MacRae, Vice President,

Forecasted Drug Trend for Next Two
Years is 7 to 12%
2007 2008
Specialty Specialty
Overall Pharmacy Overall Pharmacy
Utilization
Rate 3.5-4.5% 10-18% 3.5-4.5% 10-18%
Price/Drug
Mix Rate 3.5-7.5% 10-22% 3.0-7.5% 10-22%
Total 7.0-12.0% 20-40% 6.5-12.0% 20-40%
This chart represents the PMPY gross cost increase that would prevail if no plan design or demographic changes were to occur.
Source: Caremark Trend Committee - Key metrics, February 9, 2007. 28
The Next Frontier
Pharmacogenomics and Personalized Medicine
More medications efficacious in smaller subsets
Therapeutic response
Adverse event likelihood
Specific dosing
Early detection and risk assessments
Nanotechnology – the next diagnostic frontier
- 10 atoms span 1nm
Preventative treatment prior to symptoms
Success will depend on expanding the science and
the next generation of medical technology
What changes will be required in practice,
infrastructure, and regulations?
29
Legislation – How is Caremark
Working to Help Keep Your Costs Down?
Chairs Coalition for a Competitive Pharmaceutical Marketplace
lobbying subcommittee (CCPM)
Leader in bringing generic drug issues to the forefront in
Washington
Encourage a legal pathway for FDA approval of biogenerics
Ensure current pediatric exclusivity provisions are applied to
drug dosage forms intended for children
Remove arbitrary roadblock for generic antibiotics
Clarify use of the “30 month stay-of-effectiveness” period
Caremark will continue to lobby for legislation with the
goal of reducing your pharmacy cost
30
Biogenerics vs. Conventional Generics
Biogenerics Conventional
Generics
Strategy Not established Well established
Development 5-7 years 2-5 years

Time
Projected Cost $5-15M $1-5M
Return of Late, risky Early, less risk

Investment
Innovation High Low
potential
Complexity Very high Low
Source:
Industry data, i-SEC Research 31
Innovative Plan Designs
Implementing Plan Designs to Drive
Appropriate Utilization and Improve Adherence
Goal: To improve health and Adherence Comparisons for Level 1A Class
M edication Possesion Ratio

74%75% 75%76%
wellness 80% 72%74%
Strategy: Implementation of 60%

Value-Based Tiers 2005
35%37%
Level IA – Life-sustaining 40% 2006
medications
20%
Level I – All others
es
ia
n
Level II – Life-enhancing
io
em
et
ns
th
ab
pid
As
r te
medications
Di
rli
pe
pe
Hy
High level results
Hy
Improvement in adherence in Utilization changes in level II Therapeutic Classes
0%
life sustaining drug classes
% change from Previous year

Decrease in utilization of Life
enhancing drug classes -5%
-10%
-15%
% Change in Days Supply

Contraceptives Acne Treatments Topical Antifungals
Nonsedating Antihistamines Attention Deficit Disorder
Source: Analysis conducted by Analytics and Outcomes. 32
What You can Expect From Us Ongoing…
Best in class service:
Committed to long term relationship
Dedicated Account and Marketing Team
Implementation and Operational Excellence
Grow and Adapt with HAC and its members
Commitment to providing solutions and flexibility:
One size does not fit all
Multiple financial options
Customized performance guarantees
Quality based technological innovation:
Support Four Cornerstones philosophy
Bring programs and services closer to consumers
On going investments promoting operational excellence
Unique customized clinical strategies
Support community based initiatives (RWJF/Forces4Quality)
Face to face clinical consultants with HAC’s top prescribers
Innovative strategies to address medication adherence
33
Value-Driven Healthcare
Caremark Supports the Four Cornerstones
Connecting the System Measure and Publish Price
iScribe® (MVP program, largest launch in Plan participant support
2006, free Web use nationally for all programs and tools for cost
prescribers) options
RxHub (co-owner) TGAM
Participation in Regional Health iBenefit™
Information Organizations (RHIOs)
TAD
Integrate drug information from multiple
channels
Measure and Publish Quality Create Positive Incentives

Specialty, disease management and Incentive programs to multiple
call center accreditation (JCAHO, constituencies (Visa® card,
URAC, NCQA, J.D. Power & point of sale rebates, financial
Associates) differentials for pharmacies
Publish results in peer to fill generics)
reviewed journals to share Work with clients to provide pay for
"best in class“ performance for clinicians (Horizon
Six Sigma process associated with project for incenting ePrescribing)
medication error
34

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Hot Topics and Trends in

Prescription Drug Benefits

 Trusted healthcare providers and  Real-time data connectivity and

Creating health advocacy through personalization, access and connectivity

Consumer Engagement Operational

96% 97% 97%

 Annual survey sent to all HAC plan participants

Source: Caremark Client Satisfaction Survey, 2006 8

Duyen Duong, Pharm D.,

HAC CMX BOB

 Key Drivers of HAC’s pharmacy trend management:

Price  Distribution channels and access

 Demographics  Consumer driven products

Source: Caremark data, 2004-2006 15

 Highlights maximum annualized

 Communicates safety and quality of

 Provides actionable steps

Utilization in these top 10 therapeutic classes account

Total % Biotech/ Total % Change Total Gross

Utilization in these top 10 specialty therapeutic classes account

Specialty Pharmacy Trends

% Members % Total Spend % Gross Trend

Source: Caremark data, 2006. 21

% of RXs 0.4% 0.4%

% of Plan 1.1% 1.2%

% Plan Participant 3.3% 3.2%

Gross PMPM $6.60 $6.91

Net PMPM $5.52 $5.91

Medication Utilization Health

 1st to Integrated Specialty & 9Pharmacy care 9Specialty 9Rare condition

Initial Review Re-authorization Overall

Client’s Specialty Drug Spend $27.8M

Total Avoided Drug Cost ($8.7)M

Optimal Adherence (MPR >=80%) Suboptimal Adherence (MPR <80%)

MPR= Medication Possession Ratio

Bruce MacRae, Vice President,

Total 7.0-12.0% 20-40% 6.5-12.0% 20-40%

Source: Caremark Trend Committee - Key metrics, February 9, 2007. 28

Development 5-7 years 2-5 years

Return of Late, risky Early, less risk

M edication Possesion Ratio

 Strategy: Implementation of 60%

% change from Previous year

% Change in Days Supply

Measure and Publish Quality Create Positive Incentives

Вам также может понравиться

Trusted healthcare providers and Real-time data connectivity and

Annual survey sent to all HAC plan participants

Key Drivers of HAC’s pharmacy trend management:

Price Distribution channels and access

Demographics Consumer driven products

Highlights maximum annualized

Communicates safety and quality of

Provides actionable steps

1st to Integrated Specialty & 9Pharmacy care 9Specialty 9Rare condition

Strategy: Implementation of 60%