CVS Health and Express Scripts release 2017 formulary exclusions – August 3, 2016

Pharmacy benefits managers (PBMS) CVS Health and Express Scripts released their 2017 formulary exclusion lists earlier this week; the updated formularies will go into effect in January 2017. In total, CVS’ formulary now excludes 131 drugs (up from 124 in 2016) and Express Scripts’ formulary now excludes 85 drugs (up from 80 in 2016). Most notably, CVS chose to exclude Sanofi’s basal insulins Lantus (insulin glargine) and Toujeo (U300 insulin glargine) from its 2017 Standard Formulary list. This decision is not altogether surprising; although Lantus remains the unequivocal market leader within the basal insulin market, both in terms of value as measured by sales and volume as measured by new-to-brand prescription (NBRx) market share, the payers are looking to cut costs wherever they can. We assume they’ll hear a lot from patients on this for whom Lantus is working and they don’t want to shift. As of 1Q16, Lantus held 64% of the global basal insulin market by value and 45% of the NBRx share by volume. In its 2Q16 update just last week, Sanofi management had expressed confidence that Lantus would not be excluded from most formularies. That said, management had acknowledged that the ongoing formulary negotiations have been challenging.

This decision by CVS to exclude Lantus reflects the increasing competitive and pricing pressures Lantus has faced since its patent expiry in early 2015. In its announcement, CVS shared that Lilly/BI’s biosimilar insulin glargine Basaglar, which will launch in the US on December 15, 2016, will replace Lantus on its formulary. Notably, a recent presentation by Dr. Lutz Heinemann at Keystone 2016 raised concerns about safety and quality assurance with biosimilars. We expect some providers will continue to have concerns about biosimilar insulins until they have been proven for some years, though it appears that CVS was sufficiently reassured by Basaglar’s clinical data thus far. We imagine Lilly/BI are offering fairly high rebates to CVS in exchange for the exclusive formulary positioning and we very much hope that some of these cost savings will be passed on to patients, though we’re not sure how likely that will be. We’re very interested to see what the patient reaction to this exclusion will be – on one hand, patients who are doing well on Lantus will not likely want to switch insulins, though on the other hand it’s possible that some patients may view “biosimilar” and “generic” interchangeably and will not be that concerned about a switch from Lantus to Basaglar.

Novo Nordisk’s recently-launched next-generation basal insulin Tresiba (insulin degludec) is likely the preferred alternative to Toujeo. Tresiba’s much-anticipated US launch has been strong so far, with positive feedback from patients and providers on its flexible-dosing option in particular, and we expect its launch trajectory will only continue to accelerate in 2017 with its preferred position over Toujeo. We look forward to learning more about Tresiba’s performance when Novo Nordisk provides its 2Q16 update on Friday, August 5.

• Express Scripts appears to be withholding a decision on basal insulin formulary positioning. Express Scripts’ exclusion list includes a note that the basal insulins category of Express Scripts’ formulary may be reassessed later in the year “to reflect anticipated product launches.” We assume this refers to the upcoming launch of Lilly/BI’s Basaglar at the end of this year and will be curious how its formulary positioning relates to Sanofi’s originator Lantus (insulin glargine).
• Drs. Satish Garg (University of Colorado, Denver, CO) and Irl Hirsch (University of Washington, Seattle, WA) expressed optimism that the launch of Basaglar can help slow rising insulin analog costs. Dr. Hirsch asserted that providers are “all past the line of doing what is best for patients as affordability is trumping outcomes” and suggested that for many the choice will be between Basaglar and NPH. Dr. Garg shared that he had a patient this week who paid $550 for five pens of Lantus and emphasized strongly the need to educate providers – in his view, it is entirely safe to switch patients from Lantus to Basaglar. Presumably, many more doctors will form opinions on this as patient data on switches from Lantus to Basaglar come back. Diabetes market research firm dQ&A conducted a survey in thousands of patients several months ago that looked into the willingness of patients to switch to a biosimilar insulin – for details, please contact Richard Wood at richard.wood@d-qa.com. 
• Express Scripts’ 2017 formulary will continue to exclude Novo Nordisk’s GLP-1 agonist Victoza (liraglutide). Favored alternatives are Lilly’s Trulicity (dulaglutide) and AZ’s Byetta (exenatide twice-daily) and Bydureon (exenatide once-weekly). GSK’s Tanzeum (albiglutide) also remains excluded from Express Scripts’ formulary for 2017. The continued exclusion of Victoza may come as a surprise to some as Victoza was recently the first product within the GLP-1 agonist class to demonstrate a cardioprotective benefit in the LEADER trial. That said, Novo Nordisk is likely limited in its ability to leverage the LEADER results in payer negotiations as they are not yet included in the label for the product. We’re also curious if payers perhaps view the cardioprotective benefit as likely a class effect that extends to Trulicity, Byetta, and/or Bydureon. CVS’ formulary, on the other hand, continues to favors Victoza and Trulicity while excluding AZ’s Byetta and Bydureon franchise.
• Express Scripts formulary exclusions for DPP-4 inhibitors and rapid-acting insulins remain the same. Express Scripts will continue to exclude DPP-4 inhibitor franchises for AZ’s Onglyza (saxagliptin), Takeda’s Nesina (alogliptin) in favor of Merck’s Januvia (sitagliptin) and Lilly/BI’s Tradjenta (linagliptin) franchises. Rapid-acting insulin analogs NovoLog (Novo Nordisk’s insulin aspart) and Apidra (Sanofi’s insulin glulisine) and Novo Nordisk’s human insulin Novolin continue to be excluded in favor of Lilly’s Humalog (insulin lispro) and its human insulin Humulin.
• CVS non-insulin diabetes drug exclusions also remain the same from 2016 to 2017. Like Express Scripts, CVS prefers DPP-4 inhibitors Januvia and Tradjenta over Onglyza and Nesina. CVS’ formulary exclusion list differs from Express Scripts’ for GLP-1 agonists, rapid-acting insulins, and SGLT-2 inhibitors, however. As noted above, CVS continues to prefer GLP-1 agonists Victoza and Trulicity over AZ’s Byetta and Bydureon franchise for 2017. The PBM also prefers Novo Nordisk’s NovoLog and Novolin over Humalog and Humulin. Within the SGLT-2 inhibitor class, CVS continues to exclude J&J’s Invokana (canagliflozin) franchise, whereas Express Scripts continues to include all currently available SGLT-2 inhibitors in its formulary.

-- by Helen Gao and Kelly Close