RD286 - Annual Report on the Specialty Drug Program


Executive Summary:
Overview

Specialty drugs are a category of prescription medications that have grown out of advances in drug development research, technology and design. These drugs are used to treat specific chronic or genetic conditions. Specialty drugs include biological drugs, blood-derived products, complex molecules, and select oral, injectable and infused medications. They typically require tailored patient education for safe and cost-effective use, patient-specific dosing, close patient monitoring, administration via injection, infusion or orally, and require refrigeration or other special handling.

Specialty drugs have a direct impact on any health benefit program's prescription drug expenditures. A 2004 analysis shows that, nationwide, total spending on specialty medications grew 26.6 percent in 2003. Total public and private sector spending is expected to reach $40 billion by the end of 2006 and $100 billion by 2010. Specialty "biotechnology" drugs are becoming the fastest growing segment of drug costs in America.

In Virginia, it is estimated that within the fee-for-service component of the Medicaid program, more than $11 million annually is expended on specialty drugs related to only five chronic or genetic conditions. In implementing a specialty drug program, DMAS has focused on generating program savings, managing utilization, and implementing an appropriate care management model for those patients who require specialty drug therapy. In achieving these objectives DMAS is working to limit disruption in the specialty drug market, maintain patient access to specialty drugs, and minimize administrative requirements.