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As little as fifty years ago, when you went to the pharmacy, the pharmacist had to mix everything by hand. Mixing ingredients to develop medications required extensive knowledge and careful precision from the pharmacist to blend them into the proper formulas. Nowadays, with the creation of manufactured medications by drug companies, pharmacists act as more of a dispenser than the preparer of medicine. But mixing ingredients to create new medications isn’t entirely a thing of the past; these now appear in the form of compounded medications.
Compounded medications are not approved in their final form by the FDA, but it’s a way for medication to be customized for the patient’s specific needs. This is one of the reasons why compounded medications are prescribed. For example, if the patient needs either a different dosage or concentration of the drug that is not readily available on the market, compounding pharmacies mix together ingredients to mimic FDA approved medications to provide something similar to the patient. Additionally, compounded medications are often prescribed to avoid allergens. The problem with compounded medication is that it can be expensive. Most PBMs have a list of compounded drugs to prevent high-cost utilization. However, these lists are not always complete.
1) Make sure the employees using compounding are receiving drugs that don’t require additional labor. The more complex the medication, the more time it takes and the more the cost for the labor. Capsules, troches, and suppositories require additional steps to make, so these delivery methods can increase costs. Work with your PBM and look at Rx claims data to find out which medications in your claims are compounded drugs. Lower labor prescriptions are usually gels and creams because they are simpler for compounding pharmacies to fill.
2) Ingredients are also a major factor in the price of compounded medications. If an ingredient is not common enough for it to be stocked in the pharmacy, the pharmacist would have to make a special request for the ingredient which can translate to higher costs for employers and the patient both.
Watch out for inert or inactive ingredients (cream bases, fillers) that may be added to the drug. The right benefits analytics tool will help you take an in-depth look at not only the active ingredients, but the inactive products used in compounds to identify potential waste in your pharmacy spend that may have slipped through the cracks.
Compounded medications are necessary for many patients, but it's also important to ensure that they’re being used for the right reasons and the right medical conditions.