Genentech’s decision to move three lifesaving cancer drugs from traditional wholesale distribution channels to specialty distributors has cost hospitals $300 million and in some cases, delayed patient treatment, according a January survey by Novation of more than 200 health system pharmacy directors and professionals.
The American Hospital Association released the results of Novation’s survey on Wednesday.
About eight in 10 respondents said the change in distribution had a “moderate” to “significant” effect on their organizations’ expenses, primarily through higher drug purchasing costs, increased inventory expense and extra freight charges for emergency deliveries, according to the survey.
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More than three-quarters of respondents were ordering drugs more frequently and nearly two-thirds were encountering variable and unreliable delivery times due to the distribution change, it said. Nearly three in 10 said the change in distribution channels had affected patient care, mostly by delaying treatment due to drug unavailability.
Genentech said it had received only three reports of patient access concerns directly from hospitals, and gotten none since mid-October. In these cases Genentech worked directly with the affected hospital and immediately resolved the issue, according to spokeswoman Susan Willson.
"Our primary concern is that Novation states their survey uncovered impact to patient care and patient treatment delays," Willson said. "If it is true patients are not getting these life-saving medicines, we are deeply concerned we are not hearing about it directly from hospitals or in a timely manner. We can only resolve issues if we are know where they are occurring. An anonymous survey does not help us resolve patient care issues."
Last October, the AHA and five other national hospital organizations urged Genentech to continue to distribute the cancer drugs Avastin, Herceptin and Rituxan, through the traditional distribution channels, according to the AHA.
Novation’s survey was designed to test Genentech’s assertions that their decision to change distribution methods would improve efficiency and safety, and prevent shortages.
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The survey shows opposite results, according to the AHA: 87 percent of hospital respondents reported a negative financial impact on their organizations; 57 percent said the impact has been significant; 93 percent said they had never experienced shortages of any of those three drugs prior to Genentech’s change in the distribution model.
The drugs were previously sold through national wholesalers, whose approximately 75 distribution centers supported a delivery system that allowed healthcare facilities to receive shipments at least daily, according to the AHA.
This compares to specialty pharmaceutical distributors that typically have only one or two distribution centers and use common carrier delivery companies, factors that increase cost and reduce efficiency and reliability, the AHA said.
Genentech is urging hospitals that are experiencing problems to call a dedicated hotline that's been in place since the change: 1-800-551-2231 or e-mail Distribution-Questions@gene.com.
Twitter: @SusanMorseHFN