Pharmaceutical Compliance Monitor The help to keep in Compliance Fri, 10 Mar 2017 17:16:50 +0000 en-US hourly 1 Data Security in Pharmaceuticals: Compliance is Key — But not Enough Thu, 09 Mar 2017 22:53:11 +0000 March 9, 2017

It seems like we learn about a new data breach almost every day. And unfortunately for the pharmaceutical industry, it is an attractive target for fraudulent behavior.

As a professional in the pharmaceutical industry, you likely know that the typical drug costs more than $2.5 billion to develop and takes 10-15 years to bring to market. There is a particular need for pharmaceutical companies to protect drug recipes and research given the richness of their intellectual property (IP). As these organizations rely more and more on technology to conduct business, the industry has become particularly vulnerable to cybercrime.

Adding to that, there are key challenges in the pharmaceutical industry. IP and regulated data come in specialized forms. Mobile and portable devices increase the risk of casual data loss. The process of taking therapies and medicines from research through regulatory approval requires years of sharing sensitive data with physicians, clinics, regulators and partners. Drug trials gather large amounts of patient data that must be treated with great care to comply with HIPAA and other privacy regulations. Given all of these factors, data security is of the upmost importance.

From insider negligence (the leading cause of data breaches), to the absence of BYOD policies or BYOD policy implementation, to unencrypted medical devices, to inadequate security defenses, the risks are high, and the implications of cybercrime within the pharmaceutical industry go well beyond the obvious financial damage. It can also impact consumer trust in the business and the company’s reputation and overall stability.

As a pharmaceutical executive, what can you do to mitigate these risks, comply with security-related regulations and safeguard your organization’s sensitive data? Following are three best practices to consider:

1. People – Verify, verify, verify. In a pharmaceutical company, there are many people involved in the development and launch of a drug. From the employees working on each phase to the patients participating in drug trials, the amount of confidential information is massive. Adding to that complexity, employees likely use a myriad of endpoint devices in their work, including desktops, laptops, tablets and removable media. Given all of this, the need for setting who has access to what kinds of information and being able to track how and where that information is being used and shared is critical. Implementing authentication – across users, devices and the network – can help support this and bolster efforts to ensure that sensitive information does not end up in the wrong hands.

In addition, with regards to people, it’s essential that any security measures introduced take into consideration a “frictionless” user experience. If something is too hard to follow, appears cumbersome or disrupts a user’s typical workflow, it is less likely to be adopted.

2. Policy – It’s Not Set and Forget. Having the proper security policy in place with clearly outlined processes – and ensuring the policy and processes are followed – is paramount. It should take into account best practices on adoption capabilities (easy to interpret, implement and adhere to), employee education and training procedures (not just during new employee orientation but on a regular basis), and accountability measures. A good rule of thumb is to update and continually reinforce the employee code of conduct.

3. Protection – Encryption is the Foundation. There are many different ways of protecting sensitive data, but the basis of any security and data leakage protection initiative should be encryption. Pharmaceutical organizations should encrypt everything sensitive and confidential, including IP regarding what’s in a drug, drug trial information, patient details, etc.

HIPAA requires that covered entities determine if encryption is a “reasonable and appropriate” security measure to implement in their environment. If the Office for Civil Rights has a different interpretation of “reasonable and appropriate” however, serious fines could follow. Best practice is to implement encryption to significantly reduce the risk of non-compliance. Although the Security Rule provides flexibility with implementing technical safeguards, there is no flexibility when it comes to the Breach Notification Rule. If lost or stolen data is not encrypted, covered entities must notify the Department of Health and Human Services, all affected individuals and even the state and local media in some cases. However, if lost or stolen data is encrypted and the covered entity has proof (audit logs) breach notification is not necessary.

The risk of liability from a data breach is enormous, and the associated fines are becoming more and more painful. Being compliant, while clearly important, is unfortunately not enough to ensure your data is safeguarded. It takes establishing, implementing and following the right processes around people, policy AND protection to support an effective security strategy. Hackers are getting smarter every day, and the most hacked organizations are in healthcare. Don’t let your company be one of the statistics.

Why Brand Name Development Needs to be a Part of Your Strategic Focus Wed, 17 Aug 2016 06:55:25 +0000 August 17, 2016
Brannon Cashion | Addison Whitney
Regulatory approval exists as the final hurdle to product launch – the final sign that this product, which has been studied, tested, researched, strategized – and yes, branded – is ready to find its place on the market. That it’s time for the preparation to pay dividends in making a difference in a patient’s life.

When submitting a product for approval with any of the global regulatory bodies, among the trial results and data, is the brand name. In the past, brand names were often an afterthought, created with an eye toward market. However, as the playing field for available trademarks gets smaller the need for increasingly unique names gets larger; brand name development is an area which must be a strategic focus.

As is the trend for most instances of industry evolution throughout the years, the driving force behind brand name development within the pharmaceutical space is increased awareness of the foundational knowledge behind what makes a brand name successful throughout the product life cycle has grown from its previous status of often existing as a sidebar to the product development process.

Looking at brand name development through the lens of meeting both commercial and regulatory end goals has driven an increased need for specialization. Pharmaceutical brand names walk a fine line, tasked with providing results in the marketplace while also keeping the wheels of approval turning. The underlying tactics have also shifted, unsurprisingly. Much of these tactics turn the focus on the behind-the-scenes work that is done on potential names, providing quantitative and qualitative data to support their selection for the product.

To examine the rise of brand name development strategy within the pharmaceutical space, one must examine how strategy has shaped the overall product launch model. All steps leading up to commercialization have for years worked under strategic influence. Why should a brand name development be any different? This mindset, where naming is included in the overall strategic plan, will help ensure that the same due diligence is provided to all areas of product development.

Brand name development strategic discussions have shifted from a sidebar within the overall marketing planning stages to inclusion as a piece of the product puzzle. Additionally, organizations are becoming more cognizant of what to look for when working on naming and branding.

An increased importance in brand name development steps such as testing for lookalike or sound-alike names not only helps the industry, but those it serves. Lives are saved by name safety processes that prevent patients from receiving the wrong prescription or from a doctor administering the wrong drug.

However, with great power comes great responsibility, which now lies more with the manufacturers to submit names that are judged beyond how they roll off the tongue or how well they fit on the side of a bottle.

This direction in brand name development, combined with the importance of each step in a product’s pre-launch lifecycle, has given rise to the idea that naming should be integrated earlier in the process, such as during clinical trials, which were once seen as a necessity for testing and the gathering of scientific information, with little need for development outside of the trial setup.

However, it soon became clear that one of the standard rules in branding – that the earlier a brand can be to build equity with its target audience – avails itself well to clinical trials. Early in the process of product commercialization, where missed opportunities exist to present a unified, strategic brand to an audience and therefore provide additional time and exposure to the brand, seems a perfect place for initial branding efforts The product will be presented to individuals and organizations who may one day become brand advocates – why not provide them with a consistent brand for which they could advocate?

Clinical trial branding is not only a chance to ensure consistency for external audiences, but for those internally as well. During its production and development, it is likely the product will acquire a number of nicknames, acronyms and monikers, which could vary between employees working on the same product. Confusion and misunderstandings are bound to arise if the single product is mentioned by multiple names. Clinical trial branding stops this potential problem at the beginning, by establishing a standardized and strategically developed brand to the product for use throughout the process.

Not only will the product own a singular brand name as it is progressing toward launch, but once that launch arrives the brand will have gained substantial equity with a wide-ranging audience. No longer does the product launch double as the brand launch. However, it is simply a milestone for the overall brand.

This is where brand name development comes full circle, incorporated at the very beginning of a product commercialization plan, guided by the same strategic direction as its fellow launch steps and driven by an increasingly aware and informed audience. These factors combine together to ensure that the product is armed at launch with a stronger, more impactful brand as it moves from development to deployment.

Why Medical Affairs is the Cornerstone for Building Trust in our Industry Mon, 15 Aug 2016 06:27:06 +0000 August 15, 2016
Ilyssa Levins | Center for Communication Compliance (CCC)
This article delivers a clarion call to the pharmaceutical industry to recognize, support and champion the medical affairs professional as the cornerstone for reigniting trust in our industry.

  • Medical affairs professionals are the face of our industry to healthcare professionals (HCPs) globally; rebuilding and maintaining trust among HCPs is vital
  • The primary domains of the medical affairs function – data, quality and safety – are foundations for trust building, according to 2016 data on trust in the pharmaceutical industry
  • The three elements for building trust – reliability, competence, sincerity – are integral to/ingrained in how Medical Affairs professionals operate
  • HCPs must better understand the role medical affairs professionals play in helping to improve patient outcomes

Current Situation:  Declining Trust

According to the 2016 Edelman Trust Barometer – Healthcare Sector Results, which surveyed members of the general public (click here for survey results), trust in the pharmaceutical industry is declining.
Source:  2016 Edelman Trust Barometer

At the same time, the study spotlights three trust building behaviors as opportunities for the industry to address this current dilemma/situation/perception:  data, quality and safety.
Source:  2016 Edelman Trust Barometer

Quality data about the safety and efficacy of pharmaceutical products inform decision-making among healthcare professionals who focus on reducing morbidity and mortality for patients under their care.  HCPs who have access to scientifically balanced, medically accurate, current and transparent data from medical affairs professionals can make more informed decisions.

Medical affairs professionals play a pivotal role as a change agent in light of these findings:  this function is an ambassador and purveyor of quality data with a focus on drug safety.

How We Got Here

As we review what we must do today to rebuild trust, it’s useful to look back at how we communicated with HCPs in the past.

In the 1980’s, many companies employed pharmacists as sales representatives who focused on scientific data.  In the 1990s, in the era of blockbuster drugs, we were focused on selling more drugs; reps were intent on delivering on their forecasts and targets.   The model of pharmacists as sales reps disappeared.

As “promotional” sales reps became the primary face of the pharmaceutical industry, HCPs were inevitably exposed to promotional claims rather than evidenced-based discussions.  In the 2000’s, the industry began returning to an evidence-based orientation focused on patient outcomes.  This was influenced by payers demanding more data; and a boom of trained Medical Scientific Liaisons (2003) who were able to answer questions that fell outside of the product label.

This laid a foundation for the industry when the first Corporate Integrity Agreements (2007) were signed; there was even more scrutiny on the industry’s practices relating to the discussion of investigational data.

“A 2012 Lilly study uncovered a key indicator of trust:  whether claims made by a company’s sales reps were consistent with the HCP’s experience. When marketing claims were aligned with their clinical practice, trust increased.  Conversely, claims that did not support the HCP’s experience diminished the HCP’s trust in that pharmaceutical company,” according to Jennifer Riggins, Advisor, Global Medical Channels and eCapabilities, Eli Lilly and Company.

A return to evidence-based communications with HCPs will reignite trust.

Trust Embodies the Functional Goals of Medical Affairs Professionals

There are a number of trust building models, including a three-pronged approach that combines reliabiity, competence and sincerity. (Gasten, Jean (2014), Building and Restoring Trust, Virginia Commonwealth University School of Business, Center for Corporate Education.)  Medical affairs fits the bill on all three.

  • Reliability – Medical affairs can be relied upon by healthcare professionals and patients to assess and deliver unbiased, scientifically balanced medical information.

Call to Action:   Increase HCP awareness of how industry adheres to rules/regulations and maintains high quality standards when disseminating data

  • Proof Points
  • Value-based medical planning
    • Drives data generation and dissemination with a prioritization on improving patient outcomes
      • Facilitates cross-functional collaboration to create a plan that delivers efficacy and safety data
      • Addresses needs of payers, providers, patients, healthcare professionals (including pharmacists and nurses), policy makers and patient advocacy groups
  • Industry’s rigorous review processes and systems
    • The Medical-Regulatory-Legal review (MRL) process ensures that all pharmaceutical product promotions are medically accurate and comply with FDA regulations and other applicable laws. This process is carried out within pharma companies by the regulatory affairs and legal departments in conjunction with medical affairs (medical staff). All materials used by sales representatives are reviewed.

“Over the past two decades, the pharmaceutical Industry has increasingly prioritized building teams of Medical Affairs professionals uniquely positioned to listen to, interpret, and respond to the needs of HCPs, payers, and patients. They meet these needs by generating and communicating data through many channels, including publications, educational events, and scientific exchange, both spoken and in writing.  Their MSL and Medical Information professionals play a critical role in this work,” says Thérèse McCall, Ph.D., MBA, who specializes in helping companies define and implement a value-based Medical Affairs Strategies.  Thérèse was formally Vice President, Global Medical Communications and Professional Strategies, AbbVie.

  • Competence – Medical affairs professionals are trained to adhere to consistent, high quality standards.

Call to Action:  Increase HCP awareness of the caliber of talent in dedicated medical departments

  • Proof points
  • Credentialed medical affairs professionals, who work in-house for drug manufacturers, help HCPs by providing timely access to extensive, scientifically balanced, and rigorously researched data upon their request.
  • For example, the Medical Information (MI) function possesses a current and comprehensive knowledge base and have clinical experience or training.
  • According to Tiziana Fox, Senior Director Medical Information at Janssen Scientific Affairs, “Most HCP’s don’t realize that Medical Information departments exist within the companies and that this function is not promotional in nature. They are a team of pharmacists – many with advanced degrees and specialized fellowships – who are available to help HCPs address unique product-related patient care needs.  We must to do a better job of making HCPs aware of this service.”
  • Medical affairs professionals have access to a wealth of information about their respective products not available elsewhere: clinical study details, case reports, formulation information, temperature stability data, ingredient sources and other unpublished information. As a result, they are able to create value-based medical plans and provide feedback that is customized to help HCPs make better informed medical decisions.
  • “As highly-trained health care providers and scientists, medical affairs professionals are well-positioned to learn from patients and their health care providers, then use those learnings to provide true “customer-centric” insights back to the organization,” said Diana Morgenstern, MD, Senior Director, Global Medical Affairs, at Pfizer. “Insights converted into “in touch” communications are the proof points of our competence.”
  • Sincerity – Medical affairs leaders come to work every morning with the same sincere goal – to help stakeholders make informed decisions which benefits patients.

Call to Action: Increase awareness of dedicated MI department credentials and the return to evidence-based communications

  • Proof Points
  • Value stories demonstrate how medical affairs professionals focus on providing HCPs with the right data for the right patient at the right time. These actual accounts of the interactions between medical affairs and HCPs show how med affairs professionals focus on gathering and sharing the best data versus promoting a specific drug.
  • Amit Rakhit, Chief Medical and Portfolio Management Officer for Ovid Therapeutics states that, “My team strives to be a credible scientific partner with the health care community.  Providing accurate data in a transparent fashion is of utmost importance, and in the end, if our product is not the right medicine for a particular patient, then that’s ok.  I want the provider to have the full information set readily available so that he or she can make the appropriate treatment decision for each patient.”
  • Organizations like phactMI™ are another example of how the industry builds trust in the pharmaceutical industry. PhactMITM is a collaboration of Medical Information departments across the pharmaceutical industry. The members of phactMITM began their collaboration in 2014 to provide healthcare professionals (HCPs) access to medical information across their organizations through a single point of access to address HCPs’ growing needs for transparent medical information. Their website enables access to the most current product information provided by phactMITM member companies that HCPs need to help make medical care decisions to improve patient outcomes.

A Circular Effect

According to Dominick Albano, Vice President of Global Medical Information at Pfizer, pharmaceutical company MI departments, by virtue of their technical capabilities, product expertise, and access to relevant data, are uniquely positioned to provide valuable scientific information on their products to HCPs, and ignite greater trust in the industry.

“The MI function is a cornerstone of trust because we embody and demonstrate trust building behaviors,” says Albano.  He and his colleagues published a paper on the “MI Theory of Relativity to Model MI Utilization” which posits that utilization of MI services from the industry is multifactorial with trust being one of the key ingredients.  Other factors include ease of access and awareness of the service.

According to Albano: “If we want HCPs to consider medical information from the industry as one of their top choices for obtaining product information, then we must think holistically about what drives utilization.  We can execute well thought out tactics to increase awareness and provide easier access to medical information, but we must also work to establish trust.  And while trust will take more time, the MI function is well positioned to help achieve this goal.  Then, as HCPs utilize medical information more often, we will continue to cement their trust.”

The pharmaceutical industry will always be forced to fight the trust battle in light of the obvious challenges:  politicization of medicine, the cost of drugs, misunderstanding of direct-to-consumer (DTC) advertising objectives, and a general lack of understanding regarding how pharma companies operate, among other considerations.

“Trust is a lot easier to lose than it is to gain,” says Riggins.  “We need to invest in this critical component.”  Medical Affairs professionals are doing just that.

Concludes McCall: “There should be no doubt that the Industry is committed to meeting the needs of the patient and does this in partnership with HCPs, Health Authorities, and patients themselves.  However, there is an on-going opportunity for Medical Affairs teams to communicate this commitment through important organizations such as PhRMA, phactMI and other cross industry initiatives.  The accountability of Medical Affairs professionals to tell this story is critical, and will play a key role in restoring trust in our industry.”

Beyond Traditional Marketing: What are the New Strategies for Pharma Sales? Fri, 12 Aug 2016 06:34:01 +0000 August 12, 2016
Priyabrata Sahoo | MetricStream Inc.
Sales targets! Profit margins! Lead generation! Conversion rate! Market share!  These are terms that constantly haunt sales individuals. From giving doctors expensive gifts to recommending off-label uses for drugs, pharma sales representative were more concerned on achieving sales goals rather than ethical considerations. But now it is changing. With the new code of ethics guidelines from OIG and PhRMA, traditional sales and marketing activities are triggering enforcement actions. So what are the new marketing strategies pharma companies are considering?

Traditional Marketing: Old Strategies Face New Challenges

Less than a decade ago, traditional marketing tools including visits by sales agents, gifting of things such as meals, travel expenses, use of consultants and speakers, distributions of books and educational items were very common.

But policies and guidelines have changed recently. The Office of the Inspector General (OIG) and the Pharmaceutical Researchers and Manufacturers of America (PhRMA) have developed new code of ethics and stricter guidelines to oversee sales and marketing of the drugs in the U.S.

The advent of these guidelines and increased scrutiny from the governing bodies has made it clear that pharma companies cannot afford to go easy in their sales and marketing policies. Irregularities in the procedures can certainly result in the billion-dollar penalties and irreparable damage to an organization’s reputation as it’s evident from the recent GlaxoSmithKline (GSK) China Bribery scandal.  British giant GSK was fined $3 billion for bribing doctors, off-label promotional activities and its failure to report safety data.

Not only GSK but dozen of other huge pharma companies including Elli Lilly, Pfizer, Johnson & Johnson, Bristol-Myers Squibb and AstraZeneca have recently settled government cases under the False Claims Act.

What are the Additional Strategies Companies are Following/Considering?

Keeping ethical considerations in mind and changing regulatory landscape, pharma companies have shifted their approach to sales process. These companies are now more focused one other strategies including the use of digital marketing and social networking and providing anti-bribery and anti-corruption training to the employees.

Use Digital Marketing and Social Media Tool: But Be Cautious

With the growing array of digital technologies in today’s world, pharma companies are taking a cue from it and are aligning their marketing strategies towards digital interactions, social media and mobile applications. These companies are not only using these platforms to just publicize their new products and company news, but also to interact directly with consumers and healthcare professionals.

The spend companies are allocating for this can go as high as 25% of total marketing budget. However the indecorous use of these tools can present regulatory pitfalls for companies and dangers to consumers.

Some of the most common examples of mishaps on social media are:

  • The FDA forced celebrity Kim Kardashian to remove posts on Facebook and Instagram after she promoted Diclegis, Duchesnay’s morning sickness drug, without stating any of its side effects or risks.
  • The FDA warned Zarbee’s Naturals,a dietary supplement manufacturer, because the company liked or commented on posts that implied the supplements cured disease such as insomnia, bronchitis, pneumonia, colds, congestion and allergy relief, though they’re not approved to treat the same.
  • The FDA issued a warning to Akrimax Pharmaceuticals after the company Facebook page misrepresented its drug Tirosint. The company failed to communicate risk information associate with its use.
  • AstraZeneca had to suspend a Twitter campaign because the summary section of a link embedded in a tweet mentioned the company’s drug without providing safety information making the tweet non-compliant.

So, What is the Way Out?

Given that drugs can do harm if not used properly, information regarding their use that’s put online should be vetted and approved by the company’s key opinion leaders/decision makers along with various ways the employees and agents of companies need to be trained on the regulations.

  1. Key Opinion Leaders

Key opinion leaders (KOL), or “thought leaders”, are highly respected medical experts within their domain, who influence physicians and consumers through their professional status.

Pharma companies hire KOL’s to speak on their behalf to help educate the medical community and medical institutions. This information helps in the proper use of new drugs and reduces adverse events.

  1. FCPA Compliance Training

Pharmaceutical companies are particularly vulnerable to falling afoul of corporate anti-bribery and anti-corruption regulations as they have a global reach, use subsidiaries and operate in countries with public healthcare systems and highly competitive markets.

A number of pharma companies have been in the news lately for violating FCPA:

  • Eli Lilly and Company was fined $29 million for improper payments its subsidiaries made to foreign government officials to win business in Russia, Brazil, China, and Poland.
  • Pfizer was charged $45 million for illegal payments made by its subsidiaries to foreign officials in Bulgaria, Czech Republic, China, Croatia, Italy, Kazakhstan, Russia, and Serbia to obtain regulatory approvals, sales, and increased prescriptions for its products.
  • Johnson & Johnson was accused by the SEC of bribing public doctors in several European countries to win deals for their products and paying kickbacks to Iraq to illegally obtain business. The healthcare giant ended up paying a huge fine totaling USD 70 million.

The millions of dollars in fines paid by these high profile pharmaceutical firms should act as deterrent enough to others from pursuing the same course. It’s clear that there is a need for not just stronger compliance programs, but also an urgent requirement for nurturing a culture that adheres to anti-corruption rules.

From top management to personnel involved in the sales and marketing of the drugs, FCPA training is mandatory to understand the complex regulatory requirements and ways to comply with them.

An effective FCPA training program should cover the following topics:

For Sales Personnel For Top Management
–          Key anti-corruption and anti-bribery laws that regulate business conduct

–          Prohibited actions and penalties under the FCPA

–          Liability for the actions of foreign subsidiaries, agents and rogue employees

–          Exempt actions from FCPA prosecution by the DOJ and SEC

–          Lessons learned from recent cases

–          Red Flags and other warning signs that point to corrupt practices

–          FCPA compliance in accounting and recordkeeping

–          How to implement and assess FCPA compliance policies and procedures

–          Internal investigations—when to conduct one, who should conduct it, and what to do if you find evidence of non-compliance

–          Issues that can arise during employee interviews and collection of electronic records

–          Steps that can be taken to better understand  global corruption risks

–          Why third-party due diligence can make or break your program

–          The need for ongoing risk assessments and review




No other industry is as strictly regulated across the world as the Pharma. It is, after all, in the business of improving and, in many cases, saving the life of a human being. So the network of regulatory requirements across jurisdictions is onerous and complex with good reason. By using advanced marketing strategies and providing the proper training to the employees, smart pharma companies are thriving—not just surviving– in this regulatory environment.


Combating Fraud, Waste and Abuse in Pharmacy Claims with Advanced Data Analytics Wed, 10 Aug 2016 06:16:06 +0000 August 10, 2016
Madhav Nadendla | AArete
Combating Fraud, Waste and Abuse (FWA) in Pharmacy claims continues to be a top priority for healthcare payers. Sophisticated payers are applying multi-layered FWA solutions to comprehensively address FWA issues.  Robust Pharmacy FWA solutions provide significant benefits to payers across compliance, member safety and savings by providing insights at provider, pharmacy and member levels. In addition, these solutions also offer flexibility to handle payer’s unique business requirements, the ability to frequently update algorithms with changing industry trends and refine rules to minimize false positives on an on-going basis.

Compared to medical claims, drug claims present a unique window to glean potential FWA because of the frequency, volume and standardization of data elements.  With few exceptions, pharmacies submit claims electronically following the NCPDP[1] telecommunication standard, thus enabling analytics to be programmed to identify anomalies, especially when drugs packaged with the associated unit of measure are conducive to pricing errors (e.g., a “kit” contains multiple doses and should be priced per kit, not per dose or submitted quantity).

Select trends in the Pharmacy FWA solution space:

  • Associating pharmaceuticals with health services. Matching medical and drug claims enables payers to identify over-utilization or even abusive patterns, which originate from the lack of inter-operability within the health care delivery system.  The cross-comparison of medical and pharmacy claims allows payers to identify over-utilization, detect FWA, prevent over-payments, ensure compliance, and enhance patient safety.  Sample findings as a result of integrating the review of medical and pharmacy data include:
    1. Over-lapping medical (J-codes) and pharmacy (NDC) claims billed on the same date of service
      1. Outpatient provider billed J1650 for enoxaparin (generic name for Lovenox®, an injection) while the pharmacy billed NDC for Lovenox®
      2. Outpatient provider billed J7302 for Levonorgestrel-releasing intrauterine contraceptive system while the pharmacy billed NDC for Mirena
    2. Pharmacy claims without an underlying medical diagnoses or procedures warranting utilization of the given drugs
      1. High-dose opioid analgesics for chronic pain without a cancer diagnosis
      2. Tamiflu for treatment of the common cold without an influenza diagnosis
  • Anti-psychotics without a mental illness diagnosis, especially amongst the elderly and those under long-term care
  1. Prescriber specialty outliers, prescribing drugs in certain therapeutic categories at an excessive rate in comparison to their peers
    1. Podiatrist prescribing intravenous antibiotics and opioid pain medications that may not be indicated
    2. Physical Therapist prescribing drugs e.g. anti-retroviral therapy when they are not licensed prescribers
  • Recognizing the value of prevention in addition to “pay and chase” solutions. Applying advanced technological and data mining solutions allows payers to detect and predict the likelihood of Pharmacy FWA.  “Pre-pay” Pharmacy solutions scan the claims within 24 to 48 hours of Point of Sale (POS) and prior to payment, focus on package size, liquid formulations such as injectable solutions and insulin, incorrect dosing, e.g., extended release formulations dispensed in multiple daily doses, among others.  The volume of drug claims also enables advanced analytics to identify patterns of abuse (e.g., inappropriate use of the Dispense as Written code, auto-shipment of items not requested and drug seeking behavior).
  • Identifying cost avoidance opportunities associated with over-lapping billing for retail/specialty drugs administered in the provider’s office. Drugs administered in the provider’s office that were actually dispensed by a retail or specialty pharmacy should be billed using National Drug Codes (NDCs) under the pharmacy benefit.  However, these claims are often submitted using Healthcare Procedure Coding System (HCPCS) codes as part of the medical benefit.  Although such billings may be the result of clerical errors rather than fraud or abuse, these can be costly mistakes.  Increasingly, providers have patients pick up drugs from a retail pharmacy and “brown bag” them to the provider’s office to avoid the carrying costs of these perishable products.  The time lag between the office visit/drug administration and related pharmacy claim in comparison to the submission of the medical claim makes it challenging for the payer to “connect the dots.” In addition, HCPCS codes are imprecise with respect to pricing and quantities used.  Advanced analytics are capable of matching NDCs with HCPCS codes and applying a temporality rule to identify over-lapping billings.  The return on investment can be substantial considering the high costs of these drugs.

To effectively counter Pharmacy FWA:

  • Consolidate medical and drug claims data for all lines of business (Medicare, Medicaid and commercial) and interface with the electronic medical records
  • Use a collaborative, interdisciplinary team to analyze healthcare data and build the best “mouse trap” possible as healthcare data is too technical and complex to be left to data scientists or healthcare professionals
  • Apply “look back” techniques to detect unbundling in procedure codes or ingredients used in a compound drug. By submitting multiple ingredients separately that are used in a compound product, pharmacies could escape the scrutiny of adjudication edits POS – e.g., lidocaine ointment combined with diclofenac (an oral anti-inflammatory analgesic) and gabapentin (the oral formulation is used for neuropathic pain).  When these ingredients are submitted as a compound drug, they could be denied for payment for the lack of proven efficacy, but when unbundled, they could bypass the edit
  • Acknowledge that successful FWA programs require long-term commitment and multi-disciplinary collaboration across the payer organization (claims, IT, finance, provider network, etc.) to ensure that success is not elusive
  • Technologic analytics are necessary, but insufficient to discern the nuances in gamesmanship or innocent mistakes in drug claims, clinical expertise and pharmaceutical knowledge are needed for the process to be effective.  Pharmacists with experience in detecting FWA in drug data are uniquely suited for complementing advanced technological solutions

Impact of FWA is pervasive and the associated financial losses are significant.  Unnecessary or unsafe procedures compromise quality of care and lead to safety issues.  It is everybody’s responsibility, consumers included, to combat FWA in medical and pharmacy claims.

[1] National Council for Prescription Drug Programs