OBJECTIVES: The Centers for Medicare & Medicaid Services (CMS) requires all Part D plan sponsors to report formulary information on exclusions, prior authorizations (PA), and step edits (ST) for all drugs listed in the USP (United States Pharmacopeia) formulary reference file (FRF). The objective of this research is to identify the most heavily managed USP categories and explore how management varies for branded only, generic only, and mixed groupings of the same drug active substance.
METHODS: We used the CMS Part D Formulary file for Q3-2022, which contains 458 unique formularies. 1397 active substance groupings (ASGs) were manually created for 6377 RxNORM Concept Unique Identifiers (RXCUIs) included on the USP-FRFv.8 (N=591 branded; N=254 generic; N=552 mixed). ASGs were also assigned USP categories and classes using the USP Medicare Model Guidelines v9.0 Alignment File. Spending for each USP category was determined using the Medicare Part D Spending file for 2022.
RESULTS: Across all Part D formularies, 38% of branded only drugs were on average excluded. Among branded only drugs not excluded, 54% and 2% had PAs and STs. In mixed groups, 75% of branded drugs were excluded and 25% and 3% of those not excluded had PAs and STs. Among the top 10 categories by spending, categories with the most exclusions were blood glucose regulators (36%), blood products and modifiers (33%), and central nervous system agents (32%); categories with the most PAs were antineoplastics (81%), respiratory/pulmonary agents (50%), and immunological agents (50%).
CONCLUSIONS: Among top selling drug categories, there were large differences in the preferred formulary management approach for Part D driven in part by the number of therapeutic options and/or the protected status of the category. Innovators should consider how heavily managed a drug candidate will be at launch and build evidence to address any potential access issues early in the development process.
