U.S. Pharmacopeia's draft model for Medicare prescription drug formularies establishes 146 unique therapeutic categories and pharmacologic classes, falling in between the numbers of drug groups sought by drug manufacturers and PBMs.

Issued Aug. 18, the model drug ¹ classification system includes 138 pharmacologic classes and eight therapeutic categories with no associated drug classes.

Medicare formularies will be required to contain at least two drugs in each category and class, according to the implementing regulations proposed by the Centers for Medicare & Medicaid Services (² Also see "Formulary Balancing Act: Medicare Rules Weigh Access Versus Cost Control" - Pink Sheet, 2 August, 2004., p. 17).

Though Part D sponsors and Medicare Advantage plans will not be required to follow USP's model, following the guidelines will act as a safe harbor, protecting plans from having their formularies deemed "likely to discourage enrollment" (³ Also see "USP Medicare Formulary Design Committee To Host Public Meeting Aug. 27" - Pink Sheet, 2 August, 2004., p. 19).

At 146, the quantity of categories outlined by USP falls below the number sought by drug manufacturers looking to ensure availability to a wide range of products, but also is greater than the numbers desired by health plans and pharmacy benefit managers focused on controlling costs.

The Pharmaceutical Research & Manufacturers of America has suggested that the 209 classes used in the Medicare drug discount card program may be inadequate for the comprehensive benefit.

"Even with a formulary structure as extensive as that developed for discount drug cards...choosing only two drugs per category and class would substantially reduce the range of drugs available through current formularies," PhRMA told USP in July 7 comments.

The proposed formulary therefore "fails to provide patients with critical medicine options" because it groups commonly prescribed drugs in the same class with "outmoded forms of treatment," PhRMA said following release of the model.

"The USP draft, in the unlikely event it is allowed to stand, would set back treatment for conditions including but not limited to diabetes, asthma, heart disease, depression, migraine, epilepsy and gastrointestinal conditions," the trade group said.

Under the proposed system, a number of drugs that are often described as distinct classes are grouped together with other drugs for the same indications.

For example, COX-2 inhibitors are grouped with other NSAIDs in the anti-inflammatory category. Statins are in the same group as other cholesterol-lowering drugs (see ⁴ Also see "COX-2s, Statins Have No Class In USP Medicare Draft Formulary" - Pink Sheet, 23 August, 2004. ).

The guidelines could see significant revision. CMS plans to review Medicare prescription drug plans' formularies at the "sub-class" level to ensure beneficiary access to a range of products.

While PhRMA maintains that the proposed categories do not ensure coverage for the needed number of drugs, other groups looking to control costs are likely to be dissatisfied for the opposite reason.

The employers group National Business Group on Health, for instance, told USP that the number of classes should be capped at 75.

The Pharmaceutical Care Management Association also has pushed for a maximum of 50 to 100 drug categories to reflect "how formularies are structured currently in the commercial marketplace."

The draft model, PCMA said, "could have the unintended consequence of increasing costs and jeopardizing a workable Medicare prescription drug benefit."

"Even more troubling are back-door efforts by the drug manufacturers and their front groups to have 300 or more therapeutic classes covered in the Medicare formulary," the PBM group added.

USP's guidelines explain that to address "the challenge of balancing access to needed drugs with the need for the Model Guidelines to be practical to use," it chose to focus first on clinical diagnoses, subsequently linking diagnoses to treatment with a prescription drug.

USP's expert committee "developed a classification system that begins with a disease-linked therapeutic category (generally reflective of indication), follows with pharmacologic class (primarily based on mechanism of action), and includes a further subdivision where needed."

In some cases, therapeutic categories are based on other elements such as organ system, the guidance notes, citing cardiovascular medications. Some pharmacologic classes are based on chemical structure, as with pyrimidines.

When a therapeutic category is not associated with specific pharmacologic classes, the category serves the role of a class.

USP acknowledges that this approach "is not characterized by perfect uniformity," but also asserts that it is consistent with the findings of an environmental scan performed by Booz Allen Hamilton. Existing formularies employ a "blend" of organ system, therapeutic and pharmacological approaches, the firm found.

To help balance access and simplicity, USP breaks out an additional level of "granularity" within categories for consideration by drug plans.

The first two columns of the formulary document represent the categories and classes for which plan sponsors would have to include at least two drugs, if available.

A third column represents "recommended subdivisions" for which the two-drug mandate will not apply. For example, the pharmacologic class for reuptake inhibitors is further broken down into SNRIs, SSRIs and tricyclics.

The breakdown partly embodies the level of specificity pushed by PhRMA. "The model formulary structure should include a separate lowest-level class for each distinctive mechanism of action," the group told USP in July.

However, PhRMA would have preferred if the lowest subdivisions represented whole classes. Instead, USP "has included this information as an illustration of drug groups that would serve to assure beneficiary access to medications, but, unlike the categories and classes, may not necessarily require multiple drugs," the guidelines state.

USP will accept formal comments on its proposal until Sept. 17; a public meeting is scheduled for Aug. 27 in Baltimore. The organization also will hold at least 20 one-on-one meetings to consult with "key organizations." USP expects to submit its finalized formulary model to CMS in December.

USP Draft Medicare Formulary Sets 146 Drug Categories And Classes

More from Archive

More from Pink Sheet