It's Not Easy Being a Rare Disease Specialty Pharmacy| Asembia’s AXS25 Summit

Michael Einodshofer, RPh, MBA, said it was one of the highlights of his career. He was working at Maxor, a midsized specialty pharmacy. It had just snared access to one of Vertex’s products.

“It was a very small panel of SPs [specialty pharmacies] that got added. We celebrated. Everyone was ecstatic. And it was amazing. Everything clinically clicked. That's the only reason we were awarded the business.

“The excitement turned to concern about a month later when the financials started to come in,” Einodshofer continued, “because we realized that we weren't properly set up, or at least optimally set up, to manage the different dynamics of a rare drug versus the general portfolio of drugs.”

Einodshofer, former chief pharmacy officer for Optum who now has his own consulting business, was one of the four speakers at a panel yesterday on the challenging economics of the specialty pharmacy for rare diseases today at the Asembia’s AXS25 Summit in Las Vegas.

Richard Faris, RPh, Ph.D., of PANTHERx Rare Pharmacy, left, and Michael Einodshofer, RPh, MBA, of Merx Consulting, after the panel discussion about rare disease specialty pharmacy.

Although the specialty pharmacy business has boomed, there are only a relatively small number of specialty pharmacies who are set up to handle drugs for rare diseases; Will Pih, co-founder of Two Labs Pharmacy, a consulting business and the moderator of the panel, put the number at 10. Einodshofer and Richard Faris, RPh, Ph.D., chief strategy officer for PANTHERx Rare Pharmacy, a rare disease specialty pharmacy headquartered in Pittsburgh, discussed the financial pressures that rare disease specialty pharmacies are under, and Einodshofer offered some suggestions for how to cope with them. John Daly, head of North America Patient Support Services—Specialty and General Medicines for Sanofi, and Arpan Patel, RPh, MBA, vice president of patient support, pipeline design and launch excellence at Novartis, spoke from the pharmaceutical company point of view.

Daly emphasized the importance or rare disease drug specialty pharmacies providing “high clinical touch,” expertise, on-demand care and empathy. He said that people with rare conditions experience, on average, between six to nine years before receiving a correct diagnosis “suffering with less quality of life, wondering what's wrong, bouncing around, incorrect diagnosis.” He continued, “We want to pick these patients up at that moment and make sure they understand that we are there to understand that journey.

Patel said that Novartis’ pipeline is trending towards drugs with small population populations: “Everything points to the rare side.” He said the company looks for a “cooperative build” with specialty pharmacies that are in sync with services that Novartis’ hub provider.

Faris said that the high-touch services referenced by Daly mean rare disease specialty pharmacies provide services to patients on a more regular basis than any other provider in the healthcare system. “What a great opportunity to find out how that person is doing, whether it's patient-reported outcomes, understanding their quality of life, activities of daily living or other things like that,” Faris said. “There's so much more rich data beyond the dispensing data that we're really able to provide and to get to as part of our service model and patient engagement model.”

When the conversation was about economics, Faris mentioned that rising costs for personnel, shipping and other inputs have hit specialty pharmacy. He also noted that payers tend to lump specialty pharmacy services together when specialty pharmacy is, in fact, specialized, like medicine.

Vertical integration is also working against the economic interests of the rare disease specialty pharmacies, Einodshofer said in a brief interview after the panel discussion. The big three pharmacy benefit managers — CVS Caremark, Express Scripts and Optum Rx — have rare disease specialty pharmacies, he said. “If the independents are the only ones that have access to a drug, they have some leverage,” Einodshofer said. “But the minute the big verticals have access to that drug, the independents lose that leverage.”

Einodshofer showed the Asembia data from a January 2025 report by the Berkeley Research Group about the pharmaceutical supply chain to illustrate the divergent fortunes of what he termed the “legacy pharmacy model” and other businesses and entities with a role in the pharmaceutical supply chain. Citing the Berkeley report, Einodshofer said the margins off the pharmacies and providers participating in the 340B Drug Pricing Program had increased by 1,729% from 2013 to 2023 while margins of those not participating decreased by 8% during that time. The same report shows wholesaler margins increasing 148% and pharmacy benefit manager and health plan rebates increasing 359%, according to data shown by Einodshofer. hje said one business tactic rare disease specialty pharmacies might consider is 340B participation.

“A lot of rare [disease] pharmacies are very small participants in the 340B program, but an SP [specialty pharmacy] can meaningfully improve their margins when they become a contract pharmacy,” Einodshofer said. “But there's some perception that might not be a great partnership with your pharma client, because now you're in a situation where you're actually arguably working a little bit against your manufacturer partner, because you're now selling their product at a significant discount than what they made over anticipating. So it's a very complex, very complex answer.”

Einodshofer also mentioned the possibility of rare disease specialty pharmacies moving to “cost-plus” pricing.

“What that does is it eliminates the risk you have on negative third-party reimbursements,” he said. “It might not be a margin that you love, but at least you know you're in the game now and then, once you're in the game, you can work with your manufacturer partners to prove your value.”