Ophthalmic Generics: The Same but Different?

Specialists discuss the challenges when balancing medication costs and effective care.

“One could argue that generic ophthalmic medications contain the same active ingredients as their brand-name predecessors, so why would they be any different?” says Nathan Radcliffe, MD, assistant professor of Ophthalmology at Weill Cornell Medical College in New York City. “But we've seen firsthand in practice that some generics have differed.”

Dr. Radcliffe cites several reasons why a generic may not necessarily perform clinically the same as the branded drug. “These formulations are reverse-engineered, so generic manufacturers have a list of the active ingredients from the original manufacturer, but not a list of the concentrations of the inactive ingredients,” he says. “Also, the manufacturing processes aren't always the same. In some cases, aspects of a process may still be on patent, so by law, a generic manufacturer would be required to use a different process. We never know what the result of these types of factors will be, and unfortunately, it's not something that is studied with much rigor. The FDA (See “Q&A with Keith Webber, PhD,” below) has a logical and rational approach aimed at ensuring that generics are equivalent but no matter what they do, without large human studies similar to what is required for branded drugs, there will always be some uncertainty.”

The active ingredient is a small portion of what is in the medication bottle, leaving a great deal of variability related to the inactive ingredients, according to E. Randy Craven, MD, clinical professor of Ophthalmology at the University of Colorado School of Medicine.

Robert J. Noecker, MD, MBA, director of the Glaucoma Service and professor of Ophthalmology at the University of Pittsburgh, agrees. “A big question with ophthalmic generics is bioavailability—whether the drug gets into the eye to do what it needs to do,” he says. “Gels or viscosity agents contained in a brand drug, which may help increase contact time on the eye, may not be present in a generic. For some glaucoma generics, timolol, for example, we haven't really seen any problems. But other classes of drugs, such as carbonic anhydrase inhibitors, are more complicated. Less drug may penetrate into the eye if the overall formulation is altered, or more drug could reach inside of the eye if the pH level is lowered, but this may decrease the tolerability of the product. Prostaglandin analogs are relatively unstable drugs in water-based solutions. Therefore, a specific amount of certain preservatives may be required to keep the active ingredient in solution and available to penetrate into the eye.

Dr. Craven recalled the time and effort the original manufacturer of Xalatan (Pharmacia, followed by Pfizer) put into studying how the drug concentration decreased over time if the bottle wasn't refrigerated. “They figured out how to stop the polymer of the bottle from interacting with the prostaglandin,” he says. “I would be shocked if the generic versions maintain those characteristics. Now with a big push to use them, we may see that the drugs lose concentration, which could result in less effective IOP control.”

Dr. Craven made it clear that he has no problem with patients using generic glaucoma medications, as long as he believes, based on experience, that they are safe and effective. He carefully evaluated generic timolol in his practice, found no significant difference in pressure control compared with the brand, and so continues to prescribe it. “I did not, however, see similar pressure control with a generic form of Timoptic XE, the gel-formulation originally produced by Merck, nor with a generic form of levobunolol, which was Allergan's Betagan as a branded drug,” he says. Many glaucoma specialists have reported seeing an increase in ocular allergic reactions among patients who use generic brimonidine, which has a 0.2% concentration rather than the 0.15% of Allergan's branded Alphagan P.

Tolerability is not an uncommon issue that emerges with the use of generics, Dr. Noecker says, and in some patients, the same pressure control is not achieved. “The problem with glaucoma is that it's difficult to determine what causes therapeutic failure,” he says. “Is only the generic drug to blame, is it just the course of the disease, has the patient been less compliant? It is harder to sort out than when we only had one formulation to consider. Controlling IOP over a patient's lifetime is somewhat of an art, and when a new generic medication is introduced, it gives us one more variable to work into the equation.”

Pressure of a Different Kind

All doctors, ophthalmologists included, are accustomed to receiving notices from third-party payers and pharmacists about the availability of generic substitutions for brand drugs. They are also used to patients asking if they can switch to a lower-cost generic. Ophthalmologists say, however, that this type of activity is at an all-time high. “Every day, I'm getting an unprecedented number of faxes that basically state that I should switch this patient to a generic equivalent. Some of them note that by doing so, I can save the patient X amount of dollars in a year,” Dr. Craven says. “One day recently, I received 40 of these faxes. I believe we have entered a new era. Everything I am seeing is focused on money—not science or which drug might be better for an individual patient.”

Dr. Craven says he has also seen more frequent changes in prescription drug plans' tier systems. “They're creating new pricing categories for generics,” he says. Some of the changes seem to be in stark contrast to the plans' stated goal of increasing the use of generics in order to cut costs for patients and the entire healthcare system. “Pilocarpine, for example, is an often-prescribed generic for which patients typically had a minimal copay. Some plans have moved it to a different tier with a much higher copay, and some patients have told me that all of a sudden it no longer has any type of coverage through their drug plan,” Dr. Craven says. Dr. Noecker has seen the same type of changes. “Pilocarpine, which had been one of the least expensive medications we use, has gotten much more costly,” he says.

Another drug plan push being felt by glaucoma specialists is frequent attempts to switch patients from fixed combination drops to their generic separate components, which appear more often now in higher-priced tiers. “We have come to appreciate the branded fixed combinations,” Dr. Craven says. “They allow us to prescribe fewer drops and are usually better tolerated than their separate generic components, which tends to improve patient compliance. When we do switch patients to the generics, they usually end up back at the office with conjunctivitis, saying they can't use their drops because they sting too much. I think, and maybe I am wrong, that the profit margin for generics must be higher for pharmacies and Pharmacy Benefit Management companies (PBMs), and perhaps higher still if they are able to dispense two bottles instead of one. Why else would they be putting so much time and effort into trying to convince doctors to switch so many patients to generics?”

Further complicating the issue for doctors are newer state laws that give pharmacists wide leeway for substituting generics for brand drugs. Some states mandate that a generic be dispensed if the prescription does not say “dispense as written.” In other states, such as Tennessee, in the absence of “dispense as written,” the pharmacist can dispense a generic as long as it carries an “A” rating in FDA's Orange Book (Approved Drug Products with Therapeutic Equivalence Evaluations). For drugs that have not been evaluated and rated by the FDA for bioequivalency, pharmacists in Tennessee can “use their professional judgment in selecting a generic product for substitution.”

Dr. Noecker points out another potential interference with what a doctor believes is best for his patient. If there's no generic in the class of medications prescribed, the pharmacist will often inform the doctor or the patient that a “similar” drug is available. “For example, Combigan and Cosopt are similar in that they are fixed combinations, but obviously they are not the same,” he says. “But if the profit margin is better on one drug because of the tier it's in, I'll get the letter recommending it.” Another frustration, Dr. Craven says, is “Even though we know from experience that some generic manufacturers produce higher-quality products than others, we can't request a specific generic. The patient gets whatever the pharmacy chooses to stock.”

“Once again, someone is saving money, but it's not necessarily the patient,” Dr. Radcliffe says.

PBMs under Fire

Doctors aren't alone in suspecting financial motives are behind the increased pressure to prescribe generic drugs being applied by PBMs and pharmacists. PBMs are companies hired by health plans and other large buyers of health care to administer the pharmacy benefits portion of their insurance plans. According to one industry survey,¹ the top four PBMs and their market shares by annual prescription volume as of Q3 2010 were: Medco Health Solutions, Inc. (695,000,000), CVS/Caremark Rx, Inc. (658,500,000), Argus Health Systems, Inc. (504,000,000), and Express Scripts, Inc. (449,300,000).

In their role, PBMs handle the purchasing, dispensing and reimbursement of prescription drugs. They process their client plans' claims for prescription drugs, negotiate discounts, known as “rebates,” from pharmaceutical companies, and negotiate discounts from retail pharmacies. In addition, they pay pharmacists per-prescription fees for the work they do handling medications and communicating with plan members/patients. According to survey results posted online by Atlantic Information Services,² the average dispensing fee per prescription paid by PBMs to pharmacists in the second quarter of 2009 was $1.69 for a brand and $1.88 for a generic.

PBMs have been accused of steering doctors and patients toward the most expensive branded medications in order to pad their own bottom lines. However, as more attention has been paid to how they operate, it appears they manipulate the system in other ways as well, to the detriment of their clients and ultimately patients. David Balto, an attorney who has practiced antitrust law in the Department of Justice, the Federal Trade Commission and private practice, has frequently testified before Congress on PBMs. These are some excerpts:^3,4

• “Although PBMs offer a great deal of promise in terms of the potential to control pharmaceutical costs, there is a pattern of conflicts of interest, self-dealing, and anticompetitive conduct, all of which ultimately mean that consumers pay far more for drugs than necessary.”
• “PBMs earn enormous profits by negotiating rebates and discounts with drug manufacturers in exchange for promoting certain drugs on their preferred formulary or engaging in drug substitution programs. PBMs also negotiate contracts with pharmacies to determine how much the pharmacists will be paid for dispensing medication and providing services. By paying a lower reimbursement rate to pharmacies but failing to adequately disclose reimbursement rates, PBMs can generate more revenue.”
• “Often, PBMs may favor drugs for which they receive a greater margin … even though the plan sponsor or consumer may pay more.”

Balto reported that between 2004 and 2008, three PBMs were the subject of six major federal or multidistrict cases alleging various types of misconduct, including manipulating generic (maximum allowable cost [MAC]) pricing. MAC is a pricing methodology used by states and other healthcare payers for establishing reimbursement rates to pharmacies for multisource drugs (i.e., drugs with multiple manufacturers). MAC was designed as a way to lower drug expenditures. A MAC list is a list of prescriptions for which reimbursement will be based on the cost of the generic product.

PBMs create their own MAC lists for use in their contracts with clients. Attorney Linda Cahn, who advises insurance companies and other entities on working with PBMs, contends that it is not uncommon for PBMs to manipulate MAC definitions and the definitions of “brand drug” and “generic drug” such that the PBM can create different MAC lists for different clients and select any prices it wants as the MAC prices for the drugs on its MAC lists. As such, she has written, “…a PBM cannot only deprive its client of generic savings by excluding a generic drug from its MAC list, it can do so as well by including a generic drug on its MAC list.”⁵

Keeping Glaucoma Patient Care on Track

It remains to be seen whether further scrutiny and legal action will change the impact PBMs have on the healthcare system. Glaucoma specialists say they'll continue to recommend the topical medications they expect will most effectively control each patient's IOP with the fewest side effects, utilizing generics only if they help achieve those goals or when cost to the patient is an issue. “We're always cognizant of the fact that some patients do just as well on generic medications as they do on the branded product, and others do not,” Dr. Noecker says.

When the issue of brands vs. generics arises in his practice, Dr. Radcliffe takes the time to discuss it with patients. “I want to be sure we're on the same page with costs, so I engage patients to determine what they consider to be too expensive for medications,” he says. “We discuss current copays and how switching to generic medications could end up costing them more in the long run if they're less effective. I want to monitor my patient more frequently than if he were using tried-and-true brand drugs, and this entails extra office-visit copays. Two generics may cost more than a single branded agent and necessitate more frequent dosing, and the need for additional treatments to control IOP could become a possibility. I've learned not to assume which patients would want to save money by using generic medications and which put their vision ahead of cost concerns. I've also found that discussing this issue with patients is well worth the time, because it allows me to provide the best care possible in each individual situation.”

References

1. Pharmacy Benefit Management Institute, LP [Internet]. Scottsdale, AZ: Pharmacy Benefit Management Institute, LP; c2007-2010. PBM market share: top 25 pharmacy benefit management companies and market share by annual prescription volume, as of 3rd quarter 2010 [cited 2011 Mar 21]. Available from: http://www.pbmi.com/PBMmarketshare2.asp.
2. AIS. Pharmacy Benefit Trends and Data–2000-2009 Survey Results. Washington, DC: Atlantic Information Services, Inc. Available from: http://aishealth.com/marketplace/pharmacy-benefit-trends-and-data.
3. Testimony of David Balto Before Employee Benefits Security Administration, U.S. Department of Labor Hearing on Section 408(b)(2) Regulation Fee Disclosures to Welfare Benefit Plans. Dec 7, 2010. Available from: http://www.americanprogressaction.org/issues/2010/12/pdf/balto_testimony.pdf.
4. Testimony of David Balto Before the Consumer Protection, Product Safety and Insurance Subcommittee of the Senate Committee on Commerce, Science and Transportation on Competition in the Health Care Marketplace. The Effects of Regulatory Neglect on Health Care Consumers. July 16, 2009. Available from: http://www.americanprogressaction.org/issues/2009/07/pdf/balto_care_testimony.html.
5. Managed Care Magazine [Internet]. Yardley, PA: Medimedia USA. Don't get caught by PBMs' MAC mousetraps; 2008 Sept [cited 2011 Mar 21]. Available from: http://www.managedcaremag.com/archives/0809/0809.maxallowable.html.