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With expenditures totaling $227 billion in 2007, prescription drug purchases are a growing portion of the total medical expenditure, and as this industry continues to grow, prescription drugs will continue to be a critical part of the larger health care industry. This chapter presents a survey on the economics of the US pharmaceutical industry, with a focus on the role of R&D and marketing, the determinants (and complications) of prescription drug pricing, and various aspects of consumer behavior specific to this industry, such as prescription drug regulation, the patient's interaction with the physician, and insurance coverage. This chapter also provides background in areas not often considered in the economics literature, such as the role of pharmacy benefit managers in prescription drug prices and the differentiation between alternative measures of prescription drug prices.

The purpose of this study is to understand how Amazon’s threat may impact the Pharmacy Industry as a whole and whether traditional drugstore chains such as consumer value stores (CVS) Pharmacy will need to re-think their business strategy, especially in the digital space, to account for potential disruption.

This is a hypothetical case study used as a teaching exercise to guide the learner through a decision-making process. The case starts by presenting a disruption in the retail pharmacy business that the main character must navigate by using real-world data and insights, provided in the case, to formulate a recommendation.

In an extremely competitive and consolidated pharmacy market, Amazon has the potential to change the business entirely. CVS Health will potentially face strong headwinds from Amazon’s PillPack and a downward trend in prescription sales. Regardless of the new competition, CVS Health continues to be innovative in the space. Instead of being a one-trick pony, CVS has encompassed the mentality of becoming a one-stop-shop by expanding into areas such as specialty pharmacy, health clinics, pharmacy benefits management and innovative digital capabilities.

This paper provides the reader with existing and known information about the evolving retail pharmacy business and allows the reader to interpret the new information to make their own decision on how a digital business strategy team can account for potential disruption.

The purpose of this paper is to aid employers and HR professionals in addressing the opioid epidemic, by examining the economic burden of addiction and its impact on the workplace, and it presents solutions based on a clinical approach to treatment and prevention of substance abuse.

The paper undertakes a review of current opioid addiction statistics provided by various professional organizations and the US government to assess the scope of opioid addiction and its effects on the US economy. Solutions to the growing issue of addiction are based on the author’s clinical experience within the pharmacy benefits space.

Opioid addiction costs employers an estimated $18bn annually and incurred $1tn in expenses overall in the US between the years 2001 and 2017. These figures account for factors such as medical expenses, lost productivity and loss of life. The opioid crisis has led to a significant decline in workforce participation (20 per cent among men and 25 per cent among women), making it difficult for employers to find and keep qualified workers.

In this article, the author discusses means by which employers and HR professionals can protect and retain employees in the face of a national epidemic of addiction to prescription opioids. Solutions encompass not only how to identify and address existing substance abuse, but how to prevent addiction through employee education and close clinical coordination with partners such as an organization’s pharmacy benefits manager.

The purpose of this paper is to identify and examine the major forces that are changing the way biopharmaceutical medications are purchased, distributed, and sold throughout the supply chain. This will become important as healthcare reform moves forward, and logistics will be transformed in this industry.

Multiple interviews with key informants at each level of the value chain were combined with manifest text analysis from practitioner articles to derive key insights into the primary change drivers influencing the future of the biopharmaceutical supply chain.

The research discovered radical shifts in the structure of the biopharmaceutical supply chain. Future research into biopharmaceutical supply chain practices will need to explore three primary issues: How will supply chain member compensation influence the power of parties within the network? How will the role of supply chain intermediaries change the landscape of medication delivery to the end customer? What impact will the role of regulatory constraints on product pedigree and proliferation have on this network? The relationship between these forces is mediated by operations strategy concerning inventory policy, supply chain visibility, and desired service levels.

The research was based on multiple interviews with a convenience sample, as well as text analysis from practitioner articles. These findings are an initial step to guide future more in‐depth research for this dynamic and contextually rich supply chain environment that impacts consumers in every country in the world.

The paper adds insights into the pharmaceutical supply chain, examining this from multiple perspectives.

HR leaders and corporate benefits managers must balance organizational costs with decisions about which new tools and treatments will be covered by their employee health insurance plans. Getting it right can mean the difference between life and death for cancer patients. Most HR leaders, however, are not experts in cancer treatment and do not know how to make sure their plan benefits do not create roadblocks to treatment.

A total of 295 people who were diagnosed with cancer from 2019 to 2022 participated in the 2023 CancerCare Biomarker Survey, which was conducted in January 2023.

CancerCare’s 2023 survey of cancer patients found that biomarker testing helped doctors tailor therapy for nearly all the patients (93%) whose cancers were tested over the past three years. Two in 10 cancer patients (20%) avoided unnecessary chemotherapy and/or radiation and one in 10 (10%) became eligible for a clinical trial because of biomarker testing.

Biomarker testing is a necessary tool in the advancing world of precision cancer treatment. Despite the significant and demonstrable benefits to surveyed patients, three out of 10 respondents (29%) who received biomarker testing did not have the test covered by their insurance. Some survey respondents reported that biomarker test coverage was originally denied and they had to fight to get it covered. Others had to find ways to pay out-of-pocket or seek financial assistance to cover the cost of the testing.

Unfortunately, health insurance plans often limit cancer patients’ access to recommended biomarker testing, impose burdensome prior authorization (PA) protocols or require unaffordable cost-sharing, which can prevent or delay cancer patients’ access to optimal treatments. PA, a significant source of roadblocks to timely testing and treatment, was required by a quarter (25%) of the cancer patients surveyed.

Biomarker testing is increasingly a health care equity issue and there are significant gaps in the rate of biomarker testing between black and white lung and colorectal cancer patients, which can lead to disparities in clinical trial participation and hinder access to the most effective treatments. A key way to address these barriers is to broaden insurance coverage of biomarker testing, as recommended by medical experts.

This paper aims to analyse health reforms carried out in a sample of European countries.

Using a country‐specific approach, outstanding health reform features such as: greater competition between sickness funds in Germany; fund‐holding practices in the UK; managed care models in Switzerland; health networks in France; and healthcare system decentralisation in Italy are analysed.

There have been different approaches to controlling healthcare costs. Some states relied on public sector competition by creating quasi‐markets (UK), insurance sector competition, particularly in Switzerland and Germany, organisational reforms in France by creating health networks and decentralisation in Italy.

Societal and legal aspects are not discussed.

The paper compares healthcare reform effectiveness in a number of western European countries.

The purpose of this paper is to define the roles of the key health industry constituents – patients, employers, health insurers, hospitals, physicians, Government, pharmaceutical companies and other industry suppliers, plagued with the decline of the health status and affordability in the USA.

Reviews literature to back up the author's views.

As health‐care demands increase and the constituent roles blur, the industry will experience a gradual convergence. Convergence will redefine and create overlap in the boundaries between the traditional health industry suppliers and in the end this convergence will reshape the future of the health industry.

Predicts that the drivers of change – deteriorating public health, poor quality and safety, and unaffordable health care – will continue to accelerate. Convergence will be gradual and the impact may not be immediately obvious, but the long‐term outcome will dramatically reshape the industry. For the major suppliers in the industry, recognizing convergence is only the first step. Navigating convergence so the decisions made by an organization are both productive and profitable, rather than debilitating, is a far more complicated endeavor. The decisions made will not only affect the future of each supplier but also significantly impact the constituent at the center of this industry – the patient.

Pharmaceuticals are essential for the management of many chronic conditions. As a result, it is important to examine how the administration of pharmaceutical benefits affects physicians and pharmacists providing chronic care services. In the 1990s, HMOs and PPOs began to more aggressively manage outpatient pharmaceutical benefits, leading to the growth of pharmaceutical benefit management companies (PBMs).

In this exploratory study, 10 primary care physicians and 12 pharmacists in the San Francisco area were interviewed in 1999, and 11 more pharmacists in 2004, on how they worked with PBMs and their controls on prescribing and dispensing. Responses indicated major problems for both health professionals in negotiating with the PBM as a third party payor, in coping with switches and multiple formularies, and in added work for the health care professional. Increased risk to chronically ill patients for poorer outcomes is an important related problem with PBMs.

The Medicare drug benefit law passed in 2003 will likely result in similar problems for many beneficiaries, including those with chronic care needs. The paper proposes some policy solutions to reduce PBM problems for physicians, pharmacists and the Medicare population.

New Technology Business Firms are known to be volatile dynamic organizations whose innovations are subject to short life cycles and product imitability. Venture capitalist firms who allocate funds to these start-ups need to evaluate multiple facets associated with the individual firm’s internal and external characteristics, as well as, its own unique objectives and goals. This study applies a multicriteria decision making model to the identification for venture capital firms of potential New Technology Business Firms who are requesting capital infusions.

This paper aims to review the vertical or quasi‐vertical integration that characterized the pharmaceutical industry in the mid‐1990s. The acquisitions and vertical partnerships that linked pharmacy benefits managers and drug manufacturers modified the structure of the market at that time. What were the motivations of those agreements? Did they induce any distortion on competition in the drug market? And why did they fail to achieve their desired strategic advantages?

The paper uses established theoretical perspectives, such as the resource‐based view and the theory of contestable markets, as the basis for a descriptive analysis, documenting strategic decisions of vertical integration using supporting literature in marketing and strategy.

Vertical integration did not obtain the intended results (e.g. acquisition of competitive advantages). This perspective provides a framework to examine vertical integration strategies, applicable to other industries.

The paper reviews the objectives of vertical integration strategies of US drug firms in the 1990s and their hidden agendas.