Compounding pharmacy industry launches member networkNews added by Benefits Pro on July 29, 2014

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Joined: September 07, 2011

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By Dan Cook

More benefits managers are moving to limit coverage of compounded pharmaceuticals, in part due to concerns about increasing costs and some instances of recalled compounded drugs. The industry is responding in a variety of ways to try to reassure skeptics that compounding should be viewed as part of the conventional therapeutic system. Now, a small group of compounding pharmacies has launched a network that, they say, will hold its members to the highest of standards and will work with benefits managers to allay their concerns.

United Compounding Network was created “as a limited closed network of leading compounding pharmacies … to deliver a solution to the marketplace built on quality, transparency and best practices,” the network said in a release. “UCN and its charter member compounding pharmacies are committed to working with PBMs, health plans and employers to establish a new standard and approach for how this benefit is managed.”

Network members acknowledged that the group was formed in part to address “numerous factors” that were adversely affecting the industry. For instance, last year, the pharmacy benefits management division of UnitedHealth Group decided to end coverage for a range of chemicals used in many compounded products. And this year, the nation’s largest pharmacy benefits manager, Express Scripts, ceased coverage for about 1,000 compounding ingredients, citing rising costs.

The industry maintains that compounding is essential for effectively treating many individuals who have adverse reactions to standard drugs. Decisions by benefits managers to discontinue coverage is tantamount to denying proper treatment for individuals who can’t afford to pay for compounded drugs out of pocket, the industry argues.

“To address this challenge, UCN will be comprised only of the top one percent of compounding pharmacies — or those that meet the highest bar for quality and best practices,” the network said. Network members will also receive a range of services from the network that will serve to standardize to a degree business practices.

New members, it said, will either have to be accredited or committed to beginning the accreditation process.

“Understandably, payers want to effectively manage costs for their clients and avoid the inherent risk of having to potentially do business with bad actors that have sprung up in the compounding industry,” said Julie Letwat, executive vice president of UCN. “At the same time, it is vital that patients have access to the personalized medicines they need. UCN represents a partner that plans and PBMs can negotiate with to identify fair reimbursement levels, while being able to rest assured that they are only dealing with member pharmacies that meet the highest levels of quality and best practices — ultimately leading to a solution that benefits all parties.”

The network won’t accept as members “physician-owned pharmacies or pharmacies that compound in bulk without patient-specific prescriptions.”

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