In this issue: Prior Authorization 2003 Arxcel Survey Prilosec Update Arxcel, Inc. 4390 Quinby Dr. Suite D Hamburg, NY 14075 (716) 646-9292 (716) 646-6985 Fax www.arxcel.com info@arxcel.com ARXCEL can help with: Plan Design Proposals Clinical Analysis Product Line Development Sales & Marketing		Winter 2003  Arxcel News Brief  PRIOR AUTHORIZATION What is Prior Authorization? Prior Authorization for pharmacy benefits is a process of obtaining prior approval for certain medications. It is required before they are covered under a plan's benefit program. Doctors and other healthcare providers develop guidelines for the decisions about which drugs require prior authorization. Each pharmacy benefit program creates its own list of drugs requiring prior authorization. Some drugs that might require prior authorization: Acne Medications COX-II Inhibitors Growth Hormones Obesity Medications Smoking Cessation Products Why is Prior Authorization required? Prior Authorization programs for medications are developed to ensure the appropriate use of certain medications. Some drugs are prone to misuse or are sometimes prescribed for uses that are not FDA approved. Prior Authorization acts as a safeguard against drugs that can be harmful, ineffective or misused. The process also assures that the most cost-effective, high-quality course of treatment is followed. How does Prior Authorization work? Prior Authorization procedures can differ based upon the client's perspective on managing the program. Typically, prior authorization means that a medical necessity review is performed before a medicine can be covered. The medical necessity usually requires a medical diagnosis from the prescribing doctor. The pharmacy benefit manager will determine if the condition falls within the appropriate guidelines set-up for the Plan. In most cases, the patient will experience a delay of no longer than 24 hours in obtaining medication. Any prolonged delay is usually a result of the physician not responding promptly to inquiries. How does Prior Authorization help a prescription benefit plan? Prior Authorization will assist a prescription benefit plan in the management of many medications that are prone to misuse or abuse. The appropriate use of medications guarantees that healthcare dollars are used for drugs that are medically necessary, so that the right drug is used for the right reason. The purpose of the review is to make sure that medications are being dispensed for the appropriate reason and in accordance with the guidelines of the pharmacy benefit plan. ARXCEL 2003 SURVEY Arxcel is preparing the 2nd Annual Arxcel Prescription Benefit Research Survey. The study will evaluate the opinions of executives in the healthcare industry regarding the current state and future trends in the prescription benefit industry. The study will determine respondents' viewpoints regarding such issues as the rising cost of pharmaceutical benefits, solutions for the cost increases and viability of the solutions available. The costs involved in managing prescription drug benefits have continued to rise, and Arxcel has underwritten this study to assist our clients in their prescription benefit decision making GOVERNMENT NEWS - PRILOSEC® Omeprazole, the generic form of brand-name Prilosec®, was made available for distribution on December 9, 2002. Currently, there is only one generic manufacturer of omeprazole with limited supplies. This exclusivity of the generic and the supply issues involved make for a more complicated scenario than a simple transition from a single-source product to a multi-source product. The supply limitations and pricing schemes associated with generic omeprazole have the potential to cause considerable confusion in the marketplace. Depending on the supply of omeprazole at the pharmacy, a member could receive either generic omeprazole (at a generic copay) or branded Prilosec® (at a brand copay) for each prescription or refill. In addition, the pricing of generic omeprazole as it relates to other branded products in the proton-pump inhibitor category creates a complex financial scenario for plan sponsors. If you have questions regarding the coverage of Prilosec® for your plan, contact Arxcel at (716) 646-9292. © Arxcel, Inc.