The Burrill Report


Global health services provider Cigna and EMD Serono have entered into an interesting agreement aimed at improving the compliance of multiple sclerosis patients to adhere to the regular use of medication that could prevent costly hospitalization or emergency room visits. The outcome-based contract between Cigna and EMD Serono covers the drugmaker’s Rebif, a biologic for the treatment of patients with relapsing multiple sclerosis.

It is the first outcomes-based contract for a biologic to measure effectiveness at reducing and controlling multiple sclerosis-related emergency room visits and hospitalizations and Cigna believes it will signal a change around how pharmacy contracting will be conducted in the future.

The contract is designed to help people with multiple sclerosis slow the progression of disease through medication adherence, thus preventing relapses that could lead to additional irreversible neurologic damage. Results will be measured, in part, by the percentage of hospitalization and emergency room visits that are avoided through the use of Rebif.

As a precursor to the contract, Cigna moved Rebif to preferred status on its drug list in 2010 to establish a base year for measuring the contract. The contract extends for two years through the end of 2012. EMD Serono will offer Rebif at a discount based on medication adherence, and Cigna will monitor relapse-free progression based on the number of hospitalizations and emergency room visits due to relapsing multiple sclerosis. The discount can be passed on to Cigna’s clients and individual customers in a variety of ways.

“This outcomes based contract is an example of the alignment between EMD Serono and Cigna to better meet the needs of patients and customers,” says James Hoyes, EMD Serono’s chief commercial officer. “Together, we are focused on ensuring people living with relapsing MS adhere to treatment regimens, to not only reduce the financial cost of the disease but to also improve their overall well-being and health.”

There is no known cure for multiple sclerosis, a progressive disease that often leads to disability. Estimates by The National Institutes of Neurological Disorders and Stroke place the annual cost of multiple sclerosis in the United States in the billions of dollars. According to Cigna data, the average length of a hospital stay for multiple sclerosis is over 7 days and costs $9,708 to $11,469.

Although this is the first U.S. outcomes-based contract between a pharmacy benefit manager and a pharmaceutical company for a biologic, it is not the first such contract for Cigna. The company’s performance-based contract with Merck for diabetes drugs Januvia and Janumet, announced in 2009, was designed to help customers better manage their disease. That contract was somewhat counter-intuitive in that Merck believed its drugs were so much better than current oral medications that it offered a discount based on improved blood sugar levels for people taking any oral anti-diabetic medication.

Most of the people who participated in the diabetes program set up by that contract adhered to their medications and saw their blood sugar levels improve by more than 5 percent. It led Cigna to estimate that the savings could be as much as $8,000 per person when medications are taken properly.

Cigna hopes to see the same results with the EMD Serono contract. Its goal is to align incentives so the result is a healthy individual. Both companies will also stand to gain from reduced overall healthcare costs for Cigna and increased overall Rebif sales for EMD Serono.

With many new drug regimens for chronic conditions such as multiple sclerosis costing thousands of dollars a month for the rest of a patient’s life, payers such as Cigna will want measurable results to make sure they are worth the price.


March 19, 2011
http://www.burrillreport.com/article-betting_on_results_.html