Memphis pharmacies brace as Express Scripts targets compounding drugs

July 08--The nation's largest manager of prescription benefits for insurers and employers is clamping down on coverage of more than 1,000 ingredients for compound medications it contends have greatly inflated prices but don't add medical value for patients.

St. Louis-based Express Scripts, which manages pharmacy benefits for 90 million Americans, says the move will save its customers 95 percent of compounded medication costs while still ensuring that those who need them will get them.

Express Scripts reported that skyrocketing prices cost its clients $171 million in the first quarter of this year compared with $28 million in the first quarter of 2012. That meant the average compounded drug prescription price rose to $1,100 from $90.

However, pharmacists with independent, small businesses that provide compounded medications in the Memphis area said their prices are fair, sometimes less than insurance deductibles or co-pays, and that patients whose drugs were no longer covered are likely to pay the costs themselves.

"We can normally compound at a fair price for people. I have to sleep at night," said Rodney Tubbs, a pharmacist and owner of the RX Shoppe, which fills compounding and regular prescriptions.

Doctors order the compounds as a customized alternative to medications provided by drug manufacturers. Examples include liquefied medicines that children can swallow, painkillers that can be applied to the skin instead of causing gastrointestinal side effects, discontinued drugs and hormonal cream. Custom medications can be provided for animals as well.

Express Scripts manages prescription benefits for high-profile Memphis-area employers including FedEx. Insurers and employers can choose whether to opt for coverage of the compounded medications, so employees who tell their companies they want the coverage are natural allies of the compounding pharmacists.

"A big number of patients are affected by that," said pharmacist Josh Regel, owner of Regel PharmaLab in Germantown. "I think all throughout the country is going to see some blowback on this."

The industry suffered a black eye in 2012, when a meningitis outbreak among back pain patients was traced back to the New England Compounding Center in Massachusetts.

But in addition to state regulation, the Pharmacy Compounding Accreditation Board awards accreditation to those that meet national standards. Benevere Pharmacy in Collierville last month became the seventh accredited compounding pharmacy in Tennessee.

"I'm not a proponent of compounding where it's not needed," said Brett Wright, pharmacist and owner of Benevere.

In 2012, Express Scripts completed the $29 billion buyout of Medco Health Solutions, which in 2005 had purchased Accredo Health Group, an 1,800-employee Memphis specialty pharmacy which had grown out of Le Bonheur Children's Medical Center in the 1980s.

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