Pharmacy Analytics Software: Efficiently Managing Outcomes and Controlling Drug Spend
Updated: Jan 26
It all started in a British tea shop. With cafes all over the country, J. Lyons & Co was Britain's largest catering company. A bustling lunchtime prompted the manager to call the head office, making updates to the goods needed for the following day. Lyons determined that by utilizing computers for mathematical equations the business would run more efficiently, and would eliminate the need for manual input of all of the daily numbers. Shortly after, in 1951, the world’s first real-time office application (LEO) was born.
Though LEO kick-started the idea of analyzing data to gain insights and improve value, it wasn’t until the late 90’s/early 2000s that data analysis software emerged. According to a recent article by G2, “An analytics platform consolidates the functionality of each era of data analysis, bringing with it abilities to serve many use cases and personas that benefit from data-driven insights. These modern platforms provide critical capabilities that properly realize the original promise of data analysis: more insights to a greater number of people.”
The Beginning of Pharmacy Analytics Software
With a seemingly inconsequential start, data analytics had a revolutionizing impact on every industry it touched, specifically the drug market. By the late 80s, early ’90s, data from processed pharmacy claims were garnered, effectively creating the first PBM reporting. Over 30 years later, this reporting has evolved into analytics and AI automation.
Niche tools like, pharmacy analytics software, is particularly important because there is a need for increased focus on pharmacy benefits. It is growing at a 3x faster rate than medical but typically does not get nearly as much attention.
Trailblazing companies, like Xevant, are among the few to offer a full-featured solution with built-in automation and BPO integration. This real-time look at insights allows PBMs and payers to make changes and proactively respond in order to combat potential nonadherence and rising costs.
Lasting Effects for Patients
Pharmacy analytics software does more than just provide transparency for those in the drug market, it also includes the ability to put patients on a path toward homeostasis. By applying data modeling to patient risk scores, potential medication adherence issues are exposed allowing providers and pharmacists to take proactive steps to ensure compliance before a problem occurs.
Additionally, pharma happens instantaneously. When a patient is picking up a new medication indicating that they have Hep-C, for example, that data is immediately collected allowing providers and pharmacists to better prepare for future costs and long-term care for those patients.
On a broader scale, pharmacy analytics software can give a bigger picture by comparing results of data on a wider scale. This can indicate trends, identify patterns, and reveal correlations that could help further manage medication.
More Effective Formulary Changes
Hospital-wide pharmacy and therapeutic meetings are typically held monthly. During these meetings, the pharmacy department as well as representatives from each specialty of providers (internal medicine, infectious disease, critical care) will discuss how the formulary should be adjusted. These adjustments are based on several factors including the efficacy and safety of the medication, comparison of available alternatives, as well as the cost of the medication.
Pharmacy analytics software can be used to track the ever-changing costs of drugs to monitor for large increases or decreases in the medications products. This may prompt a formulary change to an alternative if a drug with a similar efficacy and safety profile becomes significantly more cost-effective.
Predictable Drug Shortages
When a drug is in shortage, the price can increase excessively, sometimes, double, triple, or even quadrupled in price. This is most often caused by the availability of alternatives, the number of manufacturing facilities of the drug, the reasoning for the shortage, and the availability of government subsidies to assist in restocking essential drugs.
Knowing of upcoming drug shortages in advance would allow the P&T committee of hospitals to discuss formulary alternatives and prescribing best-practices to conserve the high-cost drugs while on shortage.
Lasting Effects for Pharmacy
Currently, in an outpatient setting, pharmacists must manually re-bill any prior authorization request to determine if it has been approved or denied since communications between pharmacies and payers is often lacking.
Analytical software used for prior authorization helps to automate the process and decrease the response time freeing up more time daily. This allows pharmacists the opportunity to speak with patients more about clinical concerns, or simply allow more time to fill medication, decreasing wait time for patients.
In an inpatient setting pharmacists working directly with the P&T committee will be able to more effectively make recommendations based on cost if more up-to-date tracking is available on cost-changes as opposed to manually tracking this information.
What can we predict for the future?
Pharmacy analytics software is continuing to transform the drug industry. As AI becomes more prominent, the utilization of predictive analytics will likely increase allowing for a proactive approach to managing drug costs.
Additionally, a key component to effectively manage outcomes and control drug spend relies on the integration of medical, labs, and pharmacy. This would allow key players such as PBMs, TPAs, stakeholders, and providers to have a holistic viewpoint.
Companies, like Xevant, are offering a hand to help the drug industry take its first steps in the world of AI and real-time insights. Xevant continues to break barriers that often lead to non-adherence and higher drug spend. By providing analytics happening in real-time PBMs, payers, and consultants can act proactively and avoid outdated reporting effectively helping to ensure better outcomes and control drug spend.