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Beyond Distribution: The Role of Hub Services

Beyond Distribution: The Role of Hub Services

The core mission of pharmaceutical distribution — secure, efficient and reliable healthcare delivery — provides more than 180 million patients across the United States with efficient and low-cost access to more than 4 billion prescription medicines each year. But distributors’ work does not end there.

Always staying ahead of the constantly evolving healthcare landscape, distributors have branched out to offer additional programs and services to help their supply chain partners. These offerings allow manufacturers and pharmacies to optimize efficiency and enhance their ability to treat patients.

One way distributors assist manufacturers, providers and patients is by establishing “hubs,” providing a variety of programs and services.

For example, hub offerings include patient and administrator support, adherence program administration and co-pay and prior authorization support, among other services.

While these programs may be supplementary to distributors’ core services, they provide significant value across the supply chain.

Patient Support and Adherence Programs

Distribution hubs provide a single point of contact between patients and prescribers, enabling better communication and counseling to educate patients and ensure compliance throughout the course of treatment. This individualized communication is facilitated through new and traditional techniques, such as online web portals and telephone outreach.

Constant innovation throughout the healthcare industry has led to the rapid growth of vital medications and treatments for previously untreatable diseases. These lifesaving treatments can be complex — making strict adherence more critical than ever before. By preventing more costly treatment interventions and reducing the likelihood of abandoned prescriptions, patient support and adherence programs alone have contributed to as much as $8 billion in reduced healthcare costs.

Benefit and Reimbursement Services

One of the primary drivers behind the growth of hub services is the demand for specialty drug benefit and reimbursement programs. The rapid growth of the specialty drug market has had far-reaching effects on the overall healthcare industry. Sales of specialty pharmaceuticals, generally defined as drugs available in one or more types of delivery systems (infusion, injection, orals, patches, micro-needles), grew by 10 percent between 2017 and 2018 to represent 39 percent of total global pharmaceutical sales.

Distributor hubs help remove cost barriers between patients and the vital medications developed by manufacturers and prescribed by providers through the administration of co-pay assistance programs. When a hub is operated in partnership with a pharmaceutical company, the hub can work with pharmacies to provide patients with manufacturer co-pay assistance to make medications and treatments significantly more affordable.

Given the complexity of specialty medication, insurance companies often require extensive paperwork and clinical information for review before approving a drug. Distributor-operated hubs provide services to make this process more efficient, expediting the prior authorization process to ensure patients receive the medicines and treatments they need as quickly as possible.

By removing cost and administrative barriers to critical care, hubs improve patient outcomes and reduce overall healthcare costs. It is estimated that for every 1 percent increase in specialty prescriptions that are supported by hub services, $160 million in value is created for the healthcare system through cost savings.

For additional information on distributors’ value-added services, read the Healthcare Distribution Alliance’s report, The Role of Distributors in the US Health Care Industry.

To learn more about specialty distribution measures and trends, check out the HDA Research Foundation’s recent report, 2019 Specialty Pharmaceutical Distribution: Facts, Figures and Trends.

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