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The American Journal of Managed Care January 2016
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The Introduction of Generic Risperidone in Medicare Part D
Vicki Fung, PhD; Mary Price, MA; Alisa B. Busch, MD, MS; Mary Beth Landrum, PhD; Bruce Fireman, MA; Andrew A. Nierenberg, MD; Joseph P. Newhouse, PhD; and John Hsu, MD, MBA, MSCE
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Sumesh Kachroo, PhD; Melissa Hamilton, MPH; Xianchen Liu, MD, PhD; Xianying Pan, MS; Diana Brixner, PhD; Nassir Marrouche, MD; and Joseph Biskupiak, PhD, MBA
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Alesia Ferguson, PhD; Christopher Yates, BA; and J. Mick Tilford, PhD

The Introduction of Generic Risperidone in Medicare Part D

Vicki Fung, PhD; Mary Price, MA; Alisa B. Busch, MD, MS; Mary Beth Landrum, PhD; Bruce Fireman, MA; Andrew A. Nierenberg, MD; Joseph P. Newhouse, PhD; and John Hsu, MD, MBA, MSCE
This study examines the plan characteristics associated with generic risperidone use and spending and adherence outcomes associated with use among Medicare Advantage Part D beneficiaries.

Objectives: The introduction of generic second-generation antipsychotics (SGAs), starting with risperidone in July 2008, could reduce antipsychotic spending and cost-related use barriers. This study examines associations between generic risperidone use and spending and adherence after introduction among Medicare Advantage (MA) beneficiaries.

Study Design: Historic cohort study.

Methods: The study included MA beneficiaries receiving SGA treatment prior to July 2008. We examined antipsychotic spending using linear models, adherence (proportion of days covered ≥80%) using logistic models, and nonpersistence (time to first gap in antipsychotic use >30 days) in 2009 using Cox proportional hazard models, comparing beneficiaries with versus without generic use, adjusting for individual and plan characteristics.

Results: Between July 2008 and December 2009, 22.8% of beneficiaries had ≥1 fill of generic risperidone: 73% of those previously using branded risperidone and 6.7% of those previously using other SGAs. Beneficiaries in private fee-for-service (FFS) versus health maintenance organization (HMO) plans had lower rates of generic use (hazard ratio [HR], 0.73 [95% CI, 0.56-0.96]); however, cost-sharing levels were not associated with generic use. Compared with beneficiaries who continued using other SGAs, those who switched from other SGAs to generic risperidone in 2008 had lower out-of-pocket spending (–$214; 95% CI, –$314 to –$115), higher adherence (odds ratio, 2.34; 95% CI, 1.62-3.40) and lower rates of nonpersistence (HR, 0.56; 95% CI, 0.46-0.69) in 2009.

Conclusions: Generic use was concentrated among patients previously using branded risperidone. HMO plans appeared to be more effective at encouraging generic use than unmanaged private FFS plans; however, patient financial incentives had limited influence on switching. Additional opportunity remains to encourage greater generic SGA use, reduce spending, and potentially improve treatment adherence and outcomes.

Am J Manag Care. 2016;22(1):41-48
Take-Away Points
Risperidone was the first widely used second-generation antipsychotic (SGA) available as a generic. We examined patterns of use in the first 18-months of introduction and found the following: 
  • Use of generic risperidone was concentrated among those previously using branded risperidone (ie, bioequivalent substitution); there was limited therapeutic (non-bioequivalent) substitution from other brand SGAs. 
  • Rates of generic risperidone take-up were greater in Medicare Advantage HMO plans than in private fee-for-service plans; however, patient financial incentives had limited influence on generic use. 
  • Beneficiaries who switched to generics had lower out-of-pocket spending and higher levels of drug adherence compared with beneficiaries who remained on brand SGA therapy.
Antipsychotics are among the top selling classes of drugs in the United States, largely driven by spending on second-generation antipsychotics (SGA). Antipsychotics are one of 6 protected drug classes within the Medicare Part D prescription drug program, meaning that plans are required to include all or substantially all drugs within the class on plan formularies. Medicare spending on antipsychotics was $5.9 billion in 2009, second only to antihyperlipidemics.1

Several commonly used SGAs have recently lost patent protection, starting with Risperdal (risperidone) in July 2008, and then Zyprexa (olanzapine), Geodon (ziprasidone) and Seroquel (quetiapine) in 2011 and 2012. The entry of new generic SGAs could result in substantial cost savings for Medicare and other payers. The Congressional Budget Office estimated that the overall Part D savings attributable to generic substitution in 2007 were approximately $33 billion.2

However, realizing savings associated with the availability of generic antipsychotics could be more challenging than in other therapeutic classes. Physicians and patients are often hesitant to change psychotropic drug regimens for stable patients due to concerns about lack of tolerability or effectiveness of new regimens.3-7 Market reports suggest that the entry of generic risperidone did not decrease the market share of other SGAs, suggesting limited generic substitution across molecules (ie, nonbioequivalent substitution).8,9 Even for bioequivalent substitution of the same molecule, some studies note concerns about potential reductions in adherence due to patients’ anxieties regarding changes in the name, packaging, or appearance of the drug.10,11 Conversely, greater generic substitution could improve adherence by reducing the out-of-pocket costs associated with treatment12; however, little is known about the effects of switching to generic SGAs on spending or adherence.

We examined changes in SGA treatment choices among Medicare Advantage (MA) beneficiaries in the first 18-months after generic risperidone introduction (July 2008–December 2009) and Part D plan characteristics associated with generic use. We also examined the associations between generic risperidone use and antipsychotic spending and adherence.

Study Population

This study included noninstitutionalized beneficiaries enrolled in MA prescription drug plans offered by a national carrier, including health maintenance organizations (HMOs), preferred provider organizations (PPOs), and private fee-for-service (FFS) plans. Identifying information on the plans included in the study has been removed, including markets served and exact details on cost sharing and plan structures.

MA-HMO plans have the most closed physician networks, whereas PPOs have more open networks. Until 2011, private FFS plans were not required to have formal provider networks and included the same physicians as in traditional Medicare (96% of eligible physicians, nationally).13 Because plans with tighter network structures have a greater range of tools with which to influence physician behavior, we hypothesized that generic use would be greater in HMO versus private FFS plans. Examples of commonly used tools include providing feedback to physicians on their relative rates of generic use and drug spending, and the use of physician financial incentives to encourage generic drug use.

Antipsychotics are a protected class under Part D; thus, plans have to include all drugs within the class in their formularies, but could vary tier placement and/or cost-sharing amounts for drugs within the class. We hypothesized that greater cost sharing for brand relative to generic drugs would be associated with higher rates of generic risperidone use.

All study plans had a similar formulary for antipsychotics in terms of tier placement, but co-payment levels for these tiers varied across plans. In 2007, most SGAs were preferred brand drugs (tier 2). Following the introduction of generic risperidone in 2008, risperidone was on tier 1 and Risperdal (risperidone) became nonformulary, or a nonpreferred brand, with a try/fail requirement for generic risperidone. Most of the other commonly used SGAs remained preferred brands without utilization management requirements, while some SGAs became nonpreferred brands.

We focused on beneficiaries with at least 1 SGA fill between January and June 2008, and examined SGA use patterns after the introduction of generic risperidone in July 2008. Beneficiaries were censored upon disenrollment or death. Because we focused, in part, on the relationship between cost-sharing levels and drug choices, we excluded beneficiaries receiving Part D low income subsidies (LIS) who had minimal cost sharing. In sensitivity analyses among LIS beneficiaries, findings were consistent.

Data Sources

We linked Part D Event files, medical claims, plan information, and beneficiary characteristics for all subjects. To identify the type of SGA use, we used the Medi-Span Electronic Drug File (version 2)14 and FDA Orange Book data.15

Generic Risperidone Use and Part D Plan Characteristics

We examined the cumulative proportion of beneficiaries with any generic risperidone use between July 2008 and December 2009. We used Cox proportional hazard models to examine the plan characteristics associated with time to first generic risperidone use. We stratified both analyses by whether beneficiaries were previously using brand risperidone or other SGAs before generic introduction.

We classified beneficiaries’ plan types as HMO, PPO or private FFS, and beneficiaries’ benefit designs as enhanced or basic Part D—enhanced plans included coverage for generics during the standard coverage gap (eg, after $2510 in total drug spending in 2008) and basic plans had no gap coverage. We also examined the relative cost of brand versus generic drugs during the initial coverage period prior to the gap, and focused on the preferred brand (tier 2) versus generic (tier 1) co-payment differential because the most commonly used SGAs were tier 2 drugs throughout the study period.

These models adjusted for beneficiary age, gender, race/ethnicity, Part D comorbidity risk score (RxHCC), mental health diagnoses, reason for Medicare entitlement (disabled vs aged), and prior drug spending. As a measure of beneficiaries’ stability on their SGA regimens, we adjusted for the length of time beneficiaries were receiving the last SGA used prior to July 2008. Among non-risperidone users, we also adjusted for the generic name of the last SGA used prior to July 2008.

Generic Substitution, Spending, and Adherence

We examined the association between SGA drug use patterns and antipsychotic spending (total and out of pocket) and treatment adherence and persistence. Our primary analyses examine variations in these outcomes in 2009 based on 2008 switching patterns. We focused on 4 SGA use patterns, as defined by the last SGA used prior to July 2008 and SGA use between July and December 2008: 1) bioequivalent generic substitution (brand risperidone to generic risperidone), 2) nonbioequivalent generic substitution (non-risperidone SGA to generic risperidone), 3) nonbioequivalent brand switching (non-risperidone SGA to other SGA brand), and 4) no change (same non-risperidone SGA brand throughout 2008). Beneficiaries with no SGA fills between July and December 2008 were excluded from these analyses (19.9% and 23% of brand risperidone and non-risperidone users, respectively). Because Part D Event files do not capture data on uncovered drugs, we reliably cannot assess brand risperidone use after July 2008.

Antipsychotic Spending, Adherence, and Nonpersistence

We examined total and out-of-pocket antipsychotic drug spending in 2009. We examined adherence monthly (January 2008-December 2009) and annually (2009) using the proportion of days covered (PDC). The PDC was calculated as the sum of available days’ supply of all antipsychotics divided by the total days in each time period. We defined nonpersistence as having a gap in antipsychotic supply >30 days.


To examine the associations between patterns of SGA use (eg, generic substitution) in 2008 and annual 2009 drug spending and adherence (ie, PDC >80%), we use linear and logistic regression models, respectively, adjusting for plan characteristics and covariates described above, as well as antipsychotic PDC levels in 2008. To examine the association between patterns of SGA use and nonpersistence in 2009, we used Cox proportional hazard models, adjusting for the same covariates.

To examine changes in monthly adherence levels by SGA use patterns, we used linear fixed effects (within-person) regression models to estimate changes in monthly PDC relative to the month prior to generic introduction (June 2008). These models are robust to potential measured and unmeasured time-stable confounders; we adjusted for time-varying covariates, including calendar month, beneficiaries’ Part D risk scores, and tier 2 versus tier 1 co-payment differentials.


Study Population Characteristics

Among all subjects, 24.3% used brand risperidone prior to generic introduction in July 2008. Overall, 41.3% had schizophrenia or bipolar disorder, 46.1% were disabled, and about 35.4% and 57.1% were in HMO and private FFS plans, respectively (Table 1). Mean cost-sharing levels were approximately $3 (tier 1) and $25 (tier 2).

Generic SGA Use

Figure 1 presents the cumulative percent of beneficiaries who used generic risperidone between July 2008 and December 2009. Among those using brand risperidone prior to July 2008, 67.7% used generic risperidone by December 2008 and 73% by December 2009. Among those using other brand SGAs prior to July 2008, 6.7% used generic risperidone by December 2009.

In multivariate analyses, greater cost-sharing differentials for generic versus brand drugs and enhanced Part D coverage were not significantly associated with generic use rates (Table 2). In contrast, enrollment in private FFS versus HMO plans was associated with lower rates of nonbioequivalent generic substitution (hazard ratio [HR], 0.73; 95% CI, 0.56-0.96); there were no significant differences in bioequivalent generic substitution rates.

Antipsychotic Drug Spending

Compared with beneficiaries who continued using the same non-risperidone SGA before and after generic introduction, those who switched to risperidone in 2008 (nonbioequivalent generic substitution) had similar 2009 total spending, but lower out-of-pocket antipsychotic spending (difference = –$214; 95% CI, –$314 to –$115). In contrast, those who switched to a different brand SGA in 2008 (nonbioequivalent brand switching) had higher total and out-of-pocket spending in 2009. Beneficiaries who switched from brand to generic risperidone (bioequivalent substitution) had lower total antipsychotic spending (difference = –$943; 95% CI, –$1,042 to –$843) and out-of-pocket spending (difference = –$445; 95% CI, –$485 to –$404).

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