While this is not the first value-based contract involving a diabetes therapy, there are signals that these agreements will become more common as both payers and drug makers seek to hold down prices.
Highmark, Inc, a Pittsburgh-based insurer with core markets in Pennsylvania, Delaware, and West Virginia, has reached a value-based contract with Boehringer-Ingelheim for empagliflozin, the sodium-glucose co-transporter 2 (SGLT2) inhibitor sold as Jardiance.
The drug is approved for adults with type 2 diabetes (T2D) and was the first such therapy to demonstrate a cardiovascular (CV) benefit, which led to FDA approval in December 2016 for a new indication for reduction in CV death.
The contract, announced by the insurer Tuesday, would cover empagliflozin as a monotherapy as well as fixed-dose combinations that include the drug: Synjardy (empagliflozin and metformin), Synjardy XR (empagliflozin and metformin extended release), and Glyxambi (empagliflozin and linagliptin, a dipeptidyl peptidase-4 inhibitor, or DPP-4). Approximately 140,000 people covered by Highmark’s commercial plans filled a prescription for T2D in 2017.
According to the Highmark statement and a statement from a spokeswoman for Boehringer-Ingelheim, which markets the drug with Eli Lilly, the contract will compare actual per member per month medical and pharmaceutical costs of empagliflozin and the combinations with total medical and pharmacy costs of all other antidiabetic medications. After a year, Highmark will review claims data for patients taking oral therapies with empagliflozin.
Value-based contracts—which tie reimbursement to how well a drug works—are still a relatively new concept. This is not the first such contract with a T2D therapy; a Commonwealth Fund report cites a 2009 agreement between Cigna and Merck for the DPP-4 inhibitor sitagliptin (Januvia) as one of the earliest deals of this kind. However, many recent agreements have involved more expensive therapies, such as proprotein convertase subtilisin/kexin type 9 (PCSK9) inhibitors, the $14,000-a-year injectable therapies for high cholesterol. Current list prices for empagliflozin on GoodRx varied from $552 to $614 per month.
Over the past year, experts from both pharmaceutical companies and leading payers say they expect to see more value-based agreements, as both seek to keep prices in check for consumers.
Jennifer Forsyth, a spokeswoman for Boehringer-Ingelheim, said in an email to The American Journal of Managed Care® that the drug maker also has a value-based contract with Prime Therapeutics, the pharmacy benefits manager for several members of the Blue Cross Blue Shield Association.
In its statement, Highmark said that in “an ideal scenario” all the insurer’s savings would be seen in better outcomes, because empagliflozin is working as expected. While contracts vary, the idea is for insurers to see additional discounts if they fail to realize the anticipated medical savings. This is the company’s second outcomes-based agreement and the first for a diabetes drug.
“We’re excited to enter into this outcomes-based contract with Highmark to continue our work in improving outcomes for people with diabetes who are at an increased risk for cardiovascular disease,” Christine Marsh, vice president for Market Access at Boehringer-Ingelheim Pharmaceuticals, said in a statement. “Our value-based contracts reflect our confidence in Jardiance to help reduce overall healthcare costs for this community and further our commitment to ensuring Jardiance is accessible to people who need it.”