HD9 - Abuse Deterrent Formulations for Opioid Medications – January 2017

    Executive Summary:
    House Joint Resolution 45, introduced by Delegate Kathy Byron, is a continuation of House Joint Resolution 630 that was introduced in the 2015 Session of the General Assembly by Delegate Byron. Both joint resolutions passed both houses unanimously and directed the Health Insurance Reform Commission (Commission) to study mandating health insurance coverage for Abuse Deterrent Formulations (ADFs) for opioid medications. ADF opioids are opioid drugs that are formulated in such a way that deters misuse and abuse, including making it difficult to snort or inject the drug for a more intense "high." In conducting its study, the Commission was directed to examine the issues of access by citizens of the Commonwealth to effective pain management medications and the need to require the adoption of ADF technologies for pain medicines in order to assist in the Commonwealth's continuing efforts to eliminate substance and prescription drug abuse.

    The resolution directs the Commission to complete meetings by November 30, 2016, and to submit an executive summary of its findings and recommendations by the first day of the 2017 Regular Session.

    When conducting this study pursuant to HJ 630, the Commission received testimony on this issue at its meeting on July 15, 2015.

    Commander John J. Burke, president of Pharmaceutical Diversion Education, Inc., recounted the success of the ADF of OxyContin. For over a decade beginning in the late 1990s, OxyContin was abused significantly. Abusers were able to easily crush the pills and then snort, chew, inject, or smoke the resultant powder. In August 2010, Purdue Pharma introduced a reformulated version of OxyContin that made pills much less susceptible to crushing and dissolution. As a result, the street price of OxyContin plummeted and street demand fell significantly. Data from Rx Patrol indicates that the demand for OxyContin fell almost 50 percent after the reformulation. Shortly after the introduction of ADF OxyContin, abuse of Oxycodone IR increased and cheap heroin began to dominate the illicit opioid market. Mr. Burke noted that while ADF OxyContin can still be abused, the abuser must swallow multiple pills to achieve a high. Hardened addicts prefer the quick jolt achieved by injecting or snorting the drug, which cannot be accomplished with the ADF version.

    Dr. Wayne Winegarden, Senior Fellow for Business and Economics at Pacific Research Institute and editor of the EconoSTATS project of George Mason University, presented the Commission with a cost-benefit assessment of abuse deterrent opioids. Over 100 million Americans, he reported, are afflicted by some level of chronic pain, and for many of them opioids are an important therapy. The cost of chronic pain, measured in additional health care costs and lost productivity, was estimated to range between $560 billion and $635 billion.

    Dr. Winegarden described the costs of opioid abuse as significant. More than 16,000 people die annually from overdoses involving pain medication, and opioid-related overdose deaths outnumber overdose drugs involving all other illicit drugs combined.

    A study cited by Dr. Winegarden reported that reformulated ER oxycodone resulted in savings in medical costs, workplace costs, criminal justice costs, and caregiver costs that totaled $1.04 billion in 2014. He estimated that the total annual benefits per patient from ADF opioids at $4,645 for the commercially insured population and $4,568 for the Medicaid/uninsured population. Quantifying the net benefit requires accounting for the increased costs of ADF 2 opioids, which Dr. Winegarden estimated at between $612 and $2,811 per year. Subtracting the estimated additional cost from the additional benefits provides a range in the net benefit from prescribing ADFs of $1,757 per patient to $4,033 per patient.

    Jerry Moore of TEVA Pharmaceuticals added that several states have enacted legislation mandating coverage for ADF opioids on insurers' drug formularies.

    Doug Gray of the Virginia Association of Health Plans cautioned that the General Assembly is being asked to mandate a drug formulation, which has not been done previously. He advised that health plans in Virginia evaluate the prescription drugs on their formularies on a regular basis through the use of a Pharmacy and Therapeutics Committee. Mandating the addition of new on-patent drugs to a formulary, he noted, could be very lucrative for the drug's manufacturer. He also suggested that it would be more accurate to refer to abuse deterrent formulations as "tamper deterrent," as they may still be abused orally. Most deaths from opioids involve their oral ingestion, often in combination with other substances. Mr. Gray added that "next generation" ADF opioids have not yet been approved by the FDA, and that ADF opioids remain subject to misuse and are addictive. While there are no limits on what drug manufacturers can charge for these drugs, the federal Patient Protection and Affordable Care Act sets limits on member cost-sharing obligations.

    Ben Twilley, Senior Manager for State Government Affairs at Express Scripts, shared concerns about being required to cover ADF opioids and place them on a formulary's lowest-cost tier. While some ADF opioids cost $455, extended release formulations cost $300 less. He noted that Express Scripts and other pharmacy benefit managers currently can negotiate with drug manufacturers for price reductions, and he urged the Commission to allow the marketplace to continue to operate. If appropriate, they will be added to an insurer's formulary.

    According to the BOI, there is no specific requirement for this coverage for this type of medication, and imposing such a requirement could result in a cost to the Commonwealth. The Governor's Task Force on Prescription Drug and Heroin Abuse has not examined this issue.

    Though the Commission did not complete its study of the issues raised by the resolution in the 2015 interim, it remained interested in this topic and recommended the introduction of a resolution to continue the study initiated by HJ 630 for another year.

    Pursuant to the continuation of the study through HJ 45, the Commission received testimony on this issue on November 7, 2016. At this meeting, the Commission also reviewed the staff overview of the Commission's study of ADF opioids from the 2015 interim.

    Shruti Kulkarni, Esq., Policy Director of the Center for Lawful Access and Abuse Deterrence (CLAAD) recommended mandating access to ADF opioids when doctors determine that ADFs are preferred for the patient. Ms. Kulkarni explained that CLAAD is a not-for-profit organization that works to reduce prescription drug fraud, diversion, misuse, and abuse and advocates for consumer access to quality health care. Efforts encouraged by CLAAD to address the opioid epidemic include prescriber education, safer storage of medications, and treatment for those who abuse or misuse opioids.

    The Food and Drug Administration (FDA), Ms. Kulkarni testified, has encouraged the development and use of ADFs. To get an "abuse-deterrent" label from the FDA, the drug must go through rigorous studies to demonstrate that the product reduces known or expected routes of abuse. Some drugs have incorporated ADF features but have not sought the "abuse-deterrent" labeling from the FDA.

    Ms. Kulkarni testified that insurers impede access to ADF opioids by imposing cost/benefit-related restrictions. For example, many insurers use a "fail first" policy that means a patient would have to fail on methadone or a similar generic drug before having access to ADF opioids even though methadone is many times more likely than ADF opioids to cause an overdose death.

    As explained by Ms. Kulkarni, ADF opioids are designed to make unintended overdoses less likely. One method used by ADF opioids to decrease the risk of overdose is preventing altered routes of administration. Individuals who use altered routes of administration are at an increased risk of overdose. ADF opioids can also prevent accidental misuse. For example, if an individual crushed an opioid to make it easier to digest, the active ingredient would release all at once, which could result in an accidental overdose. ADF opioids can also make medications more difficult to manipulate or can increase their unpleasant side effects when manipulated, which could result in lower black market demand.

    Ms. Kulkarni stated that the arguments against mandating access to ADF opioids have been that ADF opioids do not prevent euphoria or addiction, they cost more because there are no generics available, and the health benefits of ADF opioids are difficult to isolate. Ms. Kulkarni explained that the impact on public health can only be realized once there is increased use of ADF opioids. Additionally, ADF opioids are priced on par with other brand name medications. She stated that even an incremental reduction in abuse can have a significant public health impact, considering the widespread nature of the opioid epidemic.

    Ms. Kulkarni concluded by emphasizing that CLAAD urges the Commission to recommend legislation that ensures access to ADFs when deemed necessary by a doctor rather than allow insurers to use a "fail-first" process that could lead to overdose or death.

    Doug Gray, Executive Director of the Virginia Association of Health Plans, also spoke on this issue. He testified that the opioid epidemic is a substantial problem in Virginia and nationwide, with just the tip of the iceberg showing. Opioid abuse is a particularly difficult public health issue because opioids are so prevalent in society, but any efforts focused on limiting access to opioids may drive people to heroin use.

    Mr. Gray explained that ADF opioids that are used as directed are still addictive. These formulations may be tamper resistant, but they do not stop abuse. Therefore, insurers do not favor ADF opioids because of their higher cost and the fact that they can still be abused and are still addictive. Mr. Gray stated that other efforts such as the prescription monitoring system are more effective in addressing this issue and that coverage of ADF opioids will not be productive until the prescribing and treatment sides are under control first.

    In response to a question from Delegate Ware about whether mandating coverage of ADF opioids would help solve the opioid abuse epidemic, Mr. Gray emphasized that providing coverage for ADFs would not stop people from becoming addicted to opioids or from feeling euphoric effects from the drugs. Ms. Kulkarni added that while the ADF opioids do not prevent addiction, mandating access would allow a prescriber who finds that an ADF opioid would be beneficial to his patient to prescribe that medication. Such patients might include those with teenage children in the house or elderly patients who have an increased likelihood of unintended misuse. Mandating access would also aid the development of future generation drugs that avoid addictive properties.

    Ms. Bea Gonzalez from the Capital Results consulting firm testified that only a physician knows the right form of treatment for his patient and, considering the high stakes involved with addiction, he should have the option of prescribing an ADF opioid if that is what he deems necessary. The costs are not prohibitively high, and this effort would not mandate use by everyone; instead, mandating coverage would provide access for those who need it. "Fail first" policies put patients in a very risky position.

    In response to a question from the Chair on the benefits of ADF opioids, Ms. Kulkarni explained that abuse deterrent qualities such as including acetaminophen, which causes irritation when snorted, make the drug more difficult and less enjoyable to abuse. Additionally, these abuse deterrent factors could lead to less black market demand for the drugs.

    The Chair asked Mr. Gray what danger might exist in having ADF opioids on the formulary when there are already such substantial differences in pricing on the formulary. Mr. Gray explained that cost share is limited because it is already being used to cover other extremely high priced drugs, such as the medication necessary to treat hepatitis C. Allowing products to compete rather than mandating coverage enables health plans to manage costs. Because there are no generics for the ADF opioids, they cannot compete with other opioid medications.

    The Commission noted that this is an issue of serious concern and expressed the intention to continue to review this issue independently. The Commission made no recommendations based on the study.