Topic #1: Managing inventory and drug costs:
In this five-part blog series, we explore the top challenges that community health centers face when running profitable, efficient, and impactful in-house pharmacies. In Blog #1, we cover the topic of inventory management amid unprecedented drug price increases.
As every industry veteran is aware, drugs cost more than they used to. Over the one year period from January 2022 to January 2023, more than 4,200 pharmaceuticals saw price increases—46% of which exceeded the rate of inflation. The cost of a prescription increased, on average, by 15.2%, or about $590 per product. On the extreme end, in 2022, some drugs even saw increases of more than $20,000 or 500%.
Notably, 340B drug discount prices are not immune to these spikes in price. A recent study revealed that the price growth rate patterns for 340B drug discounts closely mirrored the profile of the wholesale acquisition cost (WAC) prices. Overall, WAC prices saw a 15% growth rate per year over 10 years, while 340B prices saw 10%. For specialty drugs classes specifically, the average growth rates were 14% for the WAC price and 6% for 340B.
Not only do these increases exacerbate challenges with supply chain management—as some patients opt to forgo prescriptions due to high costs—but it can also mean slimmer revenue margins for in-house pharmacies. Streamlining purchasing needs, ensuring pharmaceutical affordability, and building better protocol compliance adherence programs for patients is essential for any in-house pharmacy’s success.
Partnering with a pharmacy program manager, like Maxor, can help in-house pharmacies adopt a variety of strategies to help mitigate rising costs and maximize revenue.
Maxor acts as an extension of your team to help:
- Oversee supply chain: Streamline supplier interactions allow you to negotiate better pricing, optimize purchasing decisions, and maintain a seamless supply chain.
- Formulary management: Develop a strategic and ever-evolving approach to ensure you are always offering the best drug for the situation—on both a clinical and financial level.
- Assess biosimilars or therapeutic equivalents: Ensure there are clinically equivalent options to offer patients.
- Pharmacist consultation for drug optimization: Engage pharmacists’ in collaborative conversations around preventative services, drug adherence programs, appropriate dosing, medication management, and when most appropriate to dispense specialty or high-cost drugs.
The services your health center provides are invaluable points of equitable access to cost-effective services that millions depend on nationwide. To support the long-term financial health of your pharmacy, partnering with an experienced pharmacy manager such as Maxor will help you capture higher revenues, earn the most favorable rates, attract and retain the best talent, diminish patient leakage, and improve health outcomes for your patients.