2. BUY AND BILL: PHYSICIAN OFFICE ADMINISTERED
ONCOLOGY DRUG DELIVERY MODELS
• Physician office purchases drug from a wholesaler/GPO in bulk;
typically the practice purchases only hematology/oncology drugs
• Drug is shipped to physician office and placed in inventory
• Drug is admixed with diluent based on a specific order for a
specific patient; drug is administered by practice nurses
• Drug(s) are billed to insurance with administration and possibly
other charges including evaluation and management
3. BUY AND BILL: HOSPITAL ADMINISTERED
ONCOLOGY DRUG DELIVERY MODELS
• Hospital purchases drug from a wholesaler/GPO in bulk; typically
the hospital purchases a broad spectrum of drugs for inpatient and
outpatient use
• Drug is shipped to hospital and placed in inventory
• Drug is admixed with diluent based on a specific order for a
specific patient, written by a credentialed oncologist; the drug is
prepared in the hospital pharmacy drug is administered by hospital
nurses, typically under the supervision of credentialed oncologists
• Drug(s) are billed to insurance with administration and facility
charges; physician charges are billed separately
4. WHITE BAGGING: PHYSICIAN OFFICE ADMINISTERED
ONCOLOGY DRUG DELIVERY MODELS
• Physician office orders drug from a specialty pharmacy; drugs are
ordered for a specific patient and a specific cycle
• Drug is shipped to physician office and placed in patient-specific
inventory
• Drug is admixed with diluent based on a specific order for a
specific patient; drug is administered by practice nurses
• Drug(s) are billed to insurance by the specialty pharmacy; drug
administration and possibly other charges including evaluation
and management are billed by the physician office
5. BROWN BAGGING: PHYSICIAN OFFICE ADMINISTERED
ONCOLOGY DRUG DELIVERY MODELS
• Specialty pharmacy ships patient specific drug directly to the
patient
• The patient brings the drug to the physician office for
administration
• Drug is admixed with diluent based on a specific order for a
specific patient; drug is administered by practice nurses
• Drug(s) are billed by specialty pharmacy; drug administration and
possibly other charges including evaluation and management
billed by the physician
6. ORAL PRODUCTS: SPECIALTY PHARMACY MODEL
ONCOLOGY DRUG DELIVERY MODELS
• Physician orders drug from specialty pharmacy; drug is shipped
directly to the patients
• Specialty pharmacy may offer a variety of case management
options: teaching; dose escalation; compliance calls. The
physician or his designee may do the same in cooperation with
specialty pharmacy or in parallel
• Drug(s) are billed to insurance by specialty pharmacy, with a fill/
distribution fee; no administration charges can be billed by the
physician practices but perhaps some evaluation and management
fees
7. 340B IMPACT
ONCOLOGY DRUG DELIVERY MODELS
• Substantial discounts for not-for-profit hospitals which qualify
• Discounts may be applied to any hospital-based practice which
meets criteria
• Many believe that the 340b margin have driven the exodus from
physician run practices to hospital owned practices
• General feeling is that the current 340b model is not operating as it
was designed but there is little consensus on what the fix should be
• Current federal budget proposal may limit new 340b facilities
• Uncertainty
8. BIOSIMILARS IMPACT
ONCOLOGY DRUG DELIVERY MODELS
• What is a biosimilar? What isn’t a biosimilar
• Different approval pathway than the original product may lead to
confusion
• How will biosimilars be integrated into current practice? How
many will each provider use?
• Biosimilars may not merely bend the cost curve but send it the
other way
• Can we avoid the same fate of the generics?
9. IMMUNOTHERAPY IMPACT
ONCOLOGY DRUG DELIVERY MODELS
• Different practices have different familiarity with the products;
clinical trial experience helps
• Substantial investment for physician practices; budget buster for
hospitals
• Coverage and authorizations are still a moving target
• Best practices for delivery are not easily transmitted among
organizations; education projects like ICLIO
10. PATIENT OUT-OF-POCKET COST IMPACT
ONCOLOGY DRUG DELIVERY MODELS
• ACA plan design, increasing costs, and “cadillac tax” are all
forcing cost shift from insurance to individual out-of-pocket
expense
• Very difficult to estimate patient responsibility
• Patient assistance programs can be dependable or transitory; little
assistance for non-drug expenses
• Cancer diagnosis increases bankruptcy risk; drug adherence can
start to fall at copayments as low as $30/month
• Out of pocket % may exceed the provider’s drug margin
11. PATHWAYS, BUNDLES, AND VALUE
ONCOLOGY DRUG DELIVERY MODELS
• If you have pathways, do you need bundles? Experiences with
pathways and what the future may hold
• If you have bundles, do you need pathways? Experiences with
bundles and what the future may hold
• Responsibility vs. Accountability
• How do you define value…from which perspective?
• Impact of VBP on clinical trials?
12. THREATS TO MARKET ACCESS AND PRICING
ONCOLOGY DRUG DELIVERY MODELS
• PBMs pushing to broaden their drug delivery footprint
• the downside of oral parity legislation
• Erosion of delivery systems, both physician office and hospital
outpatient department; Walmart effect?
• Limitations of patient assistance programs
• Cost of combination therapy may accelerate the pressure on drug
pricing
• Health insurance affordability and underinsurance
13. CRYSTAL BALL
ONCOLOGY DRUG DELIVERY MODELS
• The drug cost conversation isn’t going away, but where and when
we hit the breaking point is unknown
• Specialty pharmacy costs will continue to be a focus area for
reform simply because of the growth rate of both total spend and
individual patient spend
• Value based reimbursement models will remain in the pilot stage
for awhile longer but with more mainstream participants; what are
the BUCA plans going to do
• Cancer care is becoming more complex yet resources are
stretched very thin; more consolidation on the way
