Drug Distribution of Speciality Pharmaceuticals

What Are Speciality Pharmaceuticals?

High-cost and high complexity drugs, known as specialty drugs, are an innovation in the world of pharma. Specialty drugs are generally biologics, i.e, the products of living cells. The concept has revolutionized the treatment of many chronic diseases, including cancer, rheumatoid arthritis, inflammatory bowel disease, and hepatitis C. Specialty drugs cover over forty disease states and categories and include over 500 drugs. The term “specialty” signifies a higher price than other drugs since it is available only through specific distribution systems and has detailed handling requirements. For instance, medicare defines any drug that has a negotiated price of 670 USD per month (or more) as a specialty drug.

Features of Specialty Drugs:

• Expensive
• High Complexity
• Scarce availability
• High touch
• Treatment for rare diseases

Approaches to Distribution of Specialty Drugs:

With the increasing trend and effectiveness of specialty drugs, health management systems have adopted various approaches to specialty drug distribution:

• Insourcing
• Outsourcing

In insourcing, the pharmaceutical company hires special staff that deals with the area of specialty pharmaceuticals. The pharmacists are responsible for buying, managing, educating the doctors and patients, and keeping an eye on outcomes. They are also responsible for assessing the safety of the drugs.

In Outsourcing, a contract is made with a licensed third-party logistics (3PL) company capable of handling unique challenges posed by the specialty drug distribution. These pharmacies are called “specialty pharmacies.” Third party logistics (3PL) for pharma provides a range of services which are as follows:

• Shipments from various clients to decrease shipment costs.
• Ensuring drug safety by using cold chain logistics technology to monitor the product during distribution.
• Provision of financial management services.
• Provide value-added services to satisfy the demands of the manufacturer.
• Last mile delivery is available in most 3PLs.
• Provide communication between handlers and physicians to facilitate discrepancies.
• Provide complete management from the first online order to the shipment and delivery.
• Provision of invoicing and customer services.
• Control of drop shipments.
• Managing national distribution on behalf of small drug makers.

Necessary Prerequisites For Distribution of Specialty Drugs:

Whether its insourcing or outsourcing, the following measures, are taken regardless:

1. Negotiating the prices, whether by volume buying or through the use of formularies.
2. Employment of staff with particular specialties in management, utilization, training of patients and physicians, and monitoring the outcomes.
3. Access centralized distribution points for specialty pharmaceutical manufacturers, resulting in the limited distribution of their products.

Major Challenge of Speciality Drugs:

Limited distribution of specialty drugs is a major concern for Governments and healthcare industries, including pharmaceutical companies. A large number of specialty drugs are appropriate only for a small population of patients, and the manufacturing cost is very high. As a result, to better serve these few patients, there are specific distribution channels with communication between the managing staff and the physicians.

Unique Management:

Specialty drugs demand special management, and the patients paying for these drugs need that management.

1. Medication management: It should be made sure that the drugs are prescribed appropriately through monitoring via lab tests and the patient’s disease condition. Pharmacists that handle the specialty drugs can handle authorization by using necessary data.
2. Patient Management: pharmacists work in close contact with the patients. Calls are made to patients to remind them of refill dates and to provide patient training and education.
3. Cost Management: increasing expenses on these drugs call for cost management. Bulk buying and centralized distributions control the cost to some extent but more developments are needed in this area.