As is often the case, it’s not a single driver that shapes a trend but rather a confluence of many. Market Drill-Down takes current market data and slices it in new ways to reveal what’s really driving the market.
Everyone seems to be talking about it, wondering how and if electronic prescribing is good or bad for business and looking for ways to quantify the effect—or even the magnitude. Yet, while the questions sound simple enough, there are significant challenges with attempting to measure electronic prescribing.
There is a proliferation of e-prescribing systems—some standalone and others part of electronic health records systems. Assessing the impact of e-prescribing is difficult at best because it is virtually impossible to separate prescribers into e-prescribers and non-eprescribers. Yet, many questions remain among brand marketers. Does e-prescribing lead to greater formulary compliance? Does it increase or decrease product substitution at the pharmacy? To help grapple with these questions, we have begun to leverage prescription claims data to better understand e-prescribing’s impact.
This month’s Drill Down focuses on some of the mega-trends presented last month at the 2012 Pharmaceutical Management Science Association (PMSA) conference in Anaheim, CA, where we began to evaluate e-prescribing’s effect on brand performance.
According to Surescripts’ “The National Progress Report on e-Prescribing and Interoperable Healthcare,” 58 percent of office-based physicians were actively using electronic prescribing in 2011. When we look at prescriptions flowing through pharmacies, we see a steady and dramatic increase—the share of prescriptions transmitted electronically to the pharmacy accounted for an estimated 36 percent of prescriptions dispensed by the end of 2011, up from 22 percent in 2010. In all, a total of 570 million scripts were routed electronically in 2011, which, according to Surescripts, is a 75 percent increase over the prior year.
This growth is driven in part by government incentives to utilize electronic prescribing. The Medicare Modernization Act has established standards for e-prescribing and will provide $27 billion in financial incentives to medical practices who begin using e-prescribing systems. Whether you are ready or not, e-prescribing proliferation is going to continue to accelerate.
e-PRESCRIBING RATE DEPENDS ON HOW YOU SLICE IT
Through prescription claims, we are able to see how a script is transmitted to a pharmacy. This allows us to separate electronic prescriptions from those presented at the pharmacy using a different mechanism. When we look a little deeper (into the data for the period from January 2009 through June 2011), we see variances in the rates of electronically transmitted prescriptions by therapeutic class— from a high of 27 percent for cholesterol absorption inhibitors (Zetia), statins, diuretics and synthetic thyroid hormones —to the lower end of the spectrum (less than 15 percent of dispensed prescriptions) for seizure disorders, anti-mania drugs, and a variety of ophthalmic therapies.
We also see that e-prescribing adoption varies dramatically by geography. Although the national e-prescribing average by state is around 27 percent, in the first half of 2011, state averages ran the gamut from 55 percent down to below 15 percent. States leading the way in e-prescribing include Massachusetts, Iowa and Rhode Island. At the other end of the spectrum, we have states with rates below 18 percent, including Oklahoma, Alabama and South Carolina.
GOOD NEWS AND NOT-SO-GOOD
What does this mean to brand health? Should you be worried, or doing anything differently because of this phenomenon? For a brand marketer, there is good and bad—and some things vary by product or therapeutic class.
Preliminary analysis of longitudinal data suggests that for several diabetes brands, when a prescription was electronically transmitted to a pharmacy, patients purchased more days of therapy over a year than patients whose prescriptions got to the pharmacy in more traditional ways. For example, we looked at the prescribing patterns for Januvia and Onglyza (Figure 1) and found that e-prescriptions accounted for an additional 16 days on therapy for Onglyza and 14 days for Januvia, compared to traditional prescriptions. Over the course of a year, this translates into a meaningful and measurable sales opportunity.
At the same time, an analysis of payer response indicates that in many classes, electronically submitted prescriptions are more likely to receive denials upon initial presentation— and at a disproportionately higher rate because a prescription is submitted too early. At PMSA we examined the diabetes oral market (Figure 2) and found that—at 27 percent— electronic prescriptions accounted for the highest share of denials due to “refill too early,” compared to other methods of transmission.
Even within a class, each brand is affected differently. An examination of the non-insulin diabetes market showed that some brands lost more prescriptions through electronic prescribing, while others lost more through the paper or phone process. Product substitutions also varied, with one brand losing one extra Rx per 100 when the prescription was electronically transmitted, compared to paper or telephone transactions.
This higher denial rate can be at least partly attributed to the speed at which e-prescriptions can be submitted. For example, a physician might refill a prescription simply out of convenience when the patient is in the office even though it is too early to refill. Because that script is submitted instantly, it increases potential of being “too early,” whereas, with a paper script, the patient takes it to the pharmacy at the “right” time. Either way, there is a chance to “lose” the patient and his or her prescription.
What do these trends mean to a pharma marketer? There are many interpretations but no doubt that e-prescribing adoption is growing exponentially. As a result, it is imperative that you begin to understand how this trend is affecting your brand in order to meet its challenges successfully.
Download these figures at: http:/www./pm360online.com/resourcecentral/
GET THE MARKET DRILL-DOWN EXPERTS WORKING FOR YOU! Submit your marketing question to Source Healthcare Analytics for deep analysis. All queries will be considered for a future column. Email Paula Fullman at Paula.Fullman@source.wolterskluwer.com