Pharmacy & Therapeutics Committee Presentation Developed for the Academy of Managed Care Pharmacy Updated: February 2016

Objectives Identify the purpose and structure of a Pharmacy & Therapeutics (P&T) Committee Understand the roles and responsibilities of a P&T Committee

P&T Committee Purpose Promote safe, effective, and cost-effective drug therapy Develop policies regarding drug evaluation, selection, and utilization Educate practitioners on drugs and appropriate drug utilization

Who Uses P&T? Any organization that maintains a drug formulary utilizes a P&T Committee Hospitals Health Plans Prescription Benefit Managers (PBMs) VA and Military Any organization that maintains a drug formulary utilizes a P&T Committee Hospitals Health Plans Prescription Benefit Managers (PBMs) VA and Military Formulary’s Placement in the Healthcare System As managed care expanded, formularies became more complex and more prevalent Pharmacy and Therapeutic’s (P&T) Committees help evaluate the contents of each Formulary to ensure its contents are clinically sound Formularies continue to be a method to control escalating drug costs Discounts (i.e. rebates) offered by manufacturers for formulary positioning of their products allow for savings

P&T Committee Membership Primarily physicians and pharmacists Includes practitioners from a variety of specialties May also include members from other divisions of healthcare Nursing, Nutritional Services, Administration, Law, Quality Assurance May also include lay member(s) Represents plan members Not a healthcare provider The size of the committee can vary depending on the needs of the committee Committee’s are typically composed of physicians and pharmacists. Additionally Nurses, Administration, Law, or Quality Assurance may be added to the committee. Organization utilize the P&T Committee to decrease the amount of bias and ensure that the formulary is clinically sound P&T Committee’s meet regularly with most organizations meeting quarterly.

P&T Committee Actions Regular meetings – no less than once per quarter CMS regulates P&T Committees for Part D plans must meet at least quarterly Review of scientific evidence and standards of practice, peer reviewed medical literature, clinical practice guidelines, and pharmacoeconomic studies Manage the development and maintenance of the organization’s drug formulary CMS guidance for P&T Committees development and review of Part D formularies can be found in the CMS Medicare Prescription Drug Benefit Manual, Chapter 6, Section 30.1. (http://www.cms.gov/Medicare/Prescription-Drug-Coverage/PrescriptionDrugCovContra/downloads/Chapter6.pdf)

P&T Committee Actions Manage educational programs regarding drug utilization Develop policies to ensure safe and effective drug use Develop policies to promote cost-effective drug therapy Advise on drug distribution and control procedures

Factors Considered by P&T Committee Clinical efficacy Safety Therapeutic need Clinical guidelines Standards of medical practice Other treatment options Pharmacoeconomics Cost There is a heavy weighting on safety and efficacy and therapeutic need (i.e. is there an unmet need in the class?) Cost is looked at last. All things being equal, net cost (after rebates) is the determinant. Pharmacoeconomic models are considered as they help estimate total cost of the drug in addition to the unit cost.

Clinical Evidence & Cost-Effectiveness Organizations choose whether to include cost data as part of the P&T Committee Review process If cost data is not included, drugs are reviewed solely on clinical efficacy and safety An administrative committee is then tasked with final formulary placement decisions based on: P&T Committee’s clinical evaluation Cost-effectiveness data Administrative committees often receive a clinical ranking of the drug’s clinical effectiveness in comparison with other medications in the class or therapeutic category. Administrative committees will review pharmacoeconomic data, pricing models, and manufacturer contracts along with the P&T Committees clinical evaluation and recommendation to determine formulary placement.

References Navarro, R. 2009. Managed Care Pharmacy Practice. 2nd edition. Sudbury, MA: Jones and Bartlett Publishers. ASHP statement on the pharmacy and therapeutics committee and the formulary system. Am J Health-Syst Pharm. 2008; 65:2384–6. CMS Medicare Prescription Drug Benefit Manual. CMS Website. http://www.cms.gov/Medicare/Prescription-Drug-Coverage/PrescriptionDrugCovContra/Downloads/Chapter6.pdf. Accessed 31 Dec 2013.

Thank you AMCP members Carly Rodriguez & Nisreen Shamseddine for updating this presentation for 2016.