NU Online News Service, April 20, 10:09 a.m.EDT

The workers' compensation industry experienced a 5.4 percentgrowth in total pharmacy spend per injured worker in 2008,according to a study by Tampa, Fla.-based comp insurance servicesfirm PMSI.

A significant portion of the increase was attributed to acopyright action by Purdue Pharma, the manufacturer of OxyContin,which removed generic equivalents of that popular pain killer fromthe marketplace.

PMSI in its "2009 Annual Drug Trends Report for Workers'Compensation" said the spending increase it charted took intoconsideration both price and utilization changes.

The firm said that, as expected, the cost of narcotic analgesicscontinued to be the main driver of total medication spend inworkers' compensation.

Painkillers had a price per prescription increase of 3.4percent, most of which, it said, could be directly attributed tothe dwindling supply of generic OxyContin drugs.

The impact of medication prices was 4.2 percent and representedthe majority of the increase in pharmacy spend, while utilizationof drugs made a much smaller contribution, the report said.

Beginning in early 2008, PMSI said there was an increase in thetotal price per prescription of long-acting OxyCodone productsdirectly attributed to an increase in the use of the brand-nameproduct.

Because OxyContin and its generic formulations accounted for 9.3percent of total drug costs, the net result was a 0.9 percentincrease in the average price for a prescription, said PMSI.

Price per prescription, said the report, will continue to riseas utilization of lower-cost generic formulations are replaced withthe higher-cost brand formulations. As of December 2008, the use ofgeneric formulations of OxyContin was down to 17.1 percent versus64.2 percent in early 2007.

In addition, it noted that three new strengths of OxyContin werelaunched in 2008: 15 mg, 30 mg and 60 mg sustained-release tablets.This also contributed to the price impact associated with thismedication, since these strengths were only available as brandformulations, said PMSI.

In 2008, the average price of a workers' compensationprescription increased by 4.2 percent. This was driven by bothnoncontrollable and controllable factors.

The noncontrollable factors, the report said, included:

o AWP (average wholesale price) increases, which werepredominantly annual inflationary factors.

o New product introductions, such as new brand medications,which increased the average price of a prescription.

o New generic medication launches, which helped to reduceprescription price.

o Loss of generic products, such as OxyContin, which increasedprice.

Historically, PMSI said average wholesale price has remainedrelatively constant for generic medications, while brandmedications have typically demonstrated a 7 percent to 9 percentannual increase.

It found results for 2008 were consistent with this averagewholesale price trend, with an AWP increase of 9.3 percent forbrand medications and a negligible increase in generic AWP.

Since brand-name medications account for 64.4 percent of totalspend, the combination of brand and generic AWP changes resulted inan overall increase in price per prescription of 6.1 percent for2008, PMSI said.

Among top brand medication spending the number one drugOxyContin AWP increased 6 percent and total spend 6.8 percent.

Overall, the new generic products released in 2008 decreased theaverage price of a prescription by slightly less than 0.1 percent.None of the new generics represented products in the top 50medications by total spend, indicating low utilization in workers'compensation, the report said.

On average, new generic products have a 10 percent lower AWPthan their brand counterparts, making their use "integral to costcontainment," said PMSI.

For long-term injuries, the report charted an increase in thenumber of prescriptions taken per year, as well as an increase inprice per prescription as the injury ages.

At first year price per prescription is under $60 andprescriptions per claimant is about five. For a 10-year injury theaverage price per prescription exceeds $160 and the average numberof prescriptions exceeds 20.

Injured workers taking medications, the report said, need to bemonitored on an ongoing basis for medication-related problems. Someof these are: multiple prescribers; multiple pharmacies; duplicatetherapy; over- or underutilization of medications; drug-to-druginteractions; suspicion of inappropriate medication-usebehaviors.

The report said pharmacy benefit managers can influenceutilization increases through effective formulary management andclinical review programs and recommended that pain managementprograms focusing on utilization management should be part of allworkers' compensation cost-containment initiatives.