Oncology Business News®
November 2012
Volume 1
Issue 2

Can Practices Successfully Dispense Oral Anticancer Agents In-House?

In-house dispensing of oral agents in the community oncology setting may provide a safer and more reliable and convenient way for patients to receive their medications.

According to a recent report, the number of oral oncolytics is increasing and has been estimated to account for a quarter to a third of all anticancer agents in the pipeline.1,2 Oral agents are poised to provide advantages for patients, such as convenient administration requiring fewer office visits. However, these drugs are expensive, are not stocked by many retail pharmacies, and because they can cause side effects as serious as those caused by parenteral agents, require patient education. Additionally, patient adherence and persistence, which are difficult for prescribing physicians to measure, have been shown to be suboptimal for oral agents even as part of uncomplicated regimens in clinical trials, and in presumably highly motivated patients.3

Prescriptions for oral chemotherapy agents can be filled in retail pharmacies (if the agents are stocked), hospital pharmacies, specialty pharmacies, mail order pharmacies, or through the doctor’s office either via a competitive acquisition program or in an office-based pharmacy.4 In-office drug dispensing by doctors, particularly those treating injured workers covered by workers’ compensation, has recently been vilified in the press as immoral and corrupt for the marked-up fees being charged, which are said to be contributing to significant healthcare costs.5 Nevertheless, doctors are increasingly filling the prescriptions they write,6 and in-house dispensing has paradoxically been suggested by the American Academy of Urgent Care Medicine as a way to reduce healthcare costs by increasing the number of patients who fill their prescriptions and take their medications appropriately, and by providing the opportunity for patient education to reduce side effects that would require additional management.7 Therefore, in-house dispensing of oral agents in the community oncology setting may provide a safer and more reliable and convenient way for patients to receive their medications.3,7

Barbara L. McAneny, MD

The IV vs Oral Model

In-house dispensing by physicians is allowed in some form in nearly all states7 except New York, Massachusetts, and Texas.6 In Utah, legislation has recently been passed to allow in-house dispensing despite opposition from pharmacists at large hospital-based cancer centers who have been responsible for the dispensing of oral anticancer agents.1 Furthermore, some states may require a physician or practice to either be licensed or to pay fees to dispense, or, in a few instances, to register as a retail pharmacy with pharmacists doing the actual dispensing.7 About half of states have “any willing provider” laws that specify that if an in-house pharmacy meets the requirements for a specialty pharmacy in that state, payers cannot prevent the in-house pharmacy from filling prescriptions.8 Although in-house dispensing could reduce the costs to a practice associated with the time involved in dealing with outside pharmacies that fill their prescriptions,3 there are other potential costs and barriers to be considered. For instance, Barbara L. McAneny, MD, chief executive officer of New Mexico Oncology Hematology Consultants, thinks that oral medications may disrupt the traditional method of financing community practices.The historic model of IV chemotherapy delivery in the office, McAneny points out, resulted from Medicare paying a markup on the drug margin and letting the practices figure out how to administer and manage therapy. Although practices, including hers, still depend on the IV drug margin, the increasing prominence of oral therapies instead of IV infusions has contributed to the instability of community oncology practices. As more oncologists have chosen to work in hospital-based centers to take advantage of the higher payments received by hospitals for their services, McAneny believes that payers will eventually come to realize that it makes more sense to pay community practices enough to manage cancer in the lower-cost community setting.

Copays, Parity, and Reimbursement Affect Oral Oncolytics

According to Bruce J. Gould, MD, medical director of Northwest Georgia Oncology Centers, oncologists who have specialty pharmacies will derive more revenue from oral oncolytics; however, drug margins for both oral and IV drugs are disappearing. He is working with some national organizations to find ways of compensating oncologists for taking care of patients that are not dependent on drug margins.High copays for oral oncolytics are partly to blame for patients not filling prescriptions and community pharmacies not stocking the drugs.1 Unlike parenteral drugs, which usually involve a fixed copay for a drug and its administration, the copay for an oral agent may involve a percentage of the drug’s costs with no outof- pocket limit. As of June, 20 states have enacted oral oncology parity laws giving patients equal access to oral as well as parenteral agents.9 Although these laws may be opposed by insurance companies, they don’t necessarily increase costs substantially.2

Jeff Patton, MD

Jeff Patton, MD, is chief executive officer of Tennessee Oncology and a founder of RainTree Oncology Services, a group purchasing organization that is providing standardized practices for all of their clients to help overcome some of the barriers to in-house dispensing of oral oncolytics. Patton says that Tennessee Oncology “definitely has patients where we choose an IV product over an oral product because financially that’s the best decision for the patient, which is really a shame.” Copay foundations and other programs that help patients with costs exist, but community practices may need to invest time to find these programs for patients.

Pre-authorization requirements by insurance companies can also take up a practice’s time. The problem can be particularly acute for individual physicians who write only a few prescriptions a year for particular agents. Having a specialist in a community practice that helps patients with financial assistance and pre-authorization full-time is likely to be more efficient and productive.

According to Ray Bailey, RPh, pharmacy director, Florida Cancer Specialists & Research Institute, the largest private group practice other than US Oncology, they have centralized nurses to do prior authorization for patients, and they take responsibility for patients getting their medication in a timely manner even if the patient goes to a specialty pharmacy. In addition to prior authorization, the practice offers a financial aid support group, copay assistance, and a foundation to fill the Medicare “donut hole.” Bailey says that his group is developing their own system to improve adherence. When medications are dispensed, it will be recorded in the patient’s electronic medical record, so prescribers will be able to see it. They are also looking at other adherence aids, such as alarmed pill containers, and having pharmacists call to remind patients about refills, and to ask them if they have any issues. The practice also has chemotherapy training classes for all patients. These issues are documented in a defined adherence care plan for each drug and data are updated in both the EMR and the pharmacy system.

Bruce J. Gould, MD

In-House Pharmacy Models

Tennessee Oncology has an in-house pharmacy that is licensed, and as a full retail pharmacy carries “everything,” says Patton. He says that they don’t try to talk their patients into getting non-oncology medications, such as antihypertensives, in-house, but are happy to provide one-stop shopping for patients. Patton notes that the carrying cost is lower for practices with a limited formulary, “but we are willing to provide whatever service our patients feel meets their needs.”

The in-house pharmacy at New Mexico Oncology Hematology Consultants sells oral chemotherapies and support drugs, such as pain medications or antibiotics, but no anti-hypertensive agents or other retail pharmacy products.

Northwest Georgia Oncology Centers also limits their inventory to oral oncolytics and support medications that a cancer or hematology patient would need, such as anti-emetics, pain medicines, antibiotics, and some selected antihypertensive drugs. Gould notes that patients need to understand why they need to take their medications and what the side effects could be. He believes that patients are more likely to trust their doctor and the doctor’s office staff to guide them through their chemotherapy rather than some third party from an outside pharmacy. In his practice, all patients are informed by their oncologist about their disease, diagnosis, prognosis, the risks and benefits of treatment, specific drugs and their side effects, and their treatment plan.

Patients prescribed oral medications also meet with the practice’s specialty pharmacist who educates them about how to use the medication, the side effects, and what they need to report to the practice. The practice’s pharmacy services are provided by RainTree Oncology Services.

Tennessee Oncology “definitely has patients where we choose an IV product over an oral product because financially that’s the best decision for the patient, which is really a shame.”

—Jeff Patton, MD


Gould says that his practice has experienced the immediate benefits of saving money on the cost of the drugs they provide and acquiring expertise in pharmacy management. Now the group is better managing their pharmacy inventory, increasing their prescription capture, and paying more attention to compliance and persistence, such as making sure that patients receive their medicines and take them, and that side effects are managed properly. The practice is testing software to measure compliance and persistence. Once this has been demonstrated, the group hopes, with RainTree’s assistance, to apply for in-network benefits for patients whose insurers require use of a specialty pharmacy.The practice of oncology is changing and has to accommodate changes in the types of medications available, how they are prescribed and dispensed, and how they will be paid for. The use of oral anticancer medications should be driven by benefits to patients, such as efficacy in their particular disease state, which could be expected to lead to improved outcomes. In-house dispensing in community oncology practices seems to have benefits for both patients and practitioners. Patients may have better access provided they can pay for their medications. Whether this access leads to improved adherence and better outcomes for patients, and how this will affect the bottom line of the dispensing practices remains to be demonstrated.


  1. O’Rourke, K. After fiery debate, physician dispensing bill passes in Utah. Pharmacy Practice News. April 2012, vs. 39. Available at:
  2. Mosely WG, Nystrom JS. Dispensing oral medications: why now and how? Community Oncology. 2009;6(8):3598-361.
  3. Andrews, M. Some states mandate better coverage of oral cancer drugs. Kaiser Health News. May 14, 2012. Available at
  4. Weingart SN, Brown E, Bach PB, et al. NCCN Task Force Report: Oral chemotherapy. JNCCN. 2008;6(suppl 3):S1-S14.
  5. Meier B, Thomas K. Insurers pay big markups as doctors dispense drugs. The New York Times. July 11, 2012. Available at:
  6. Sell D, and Inquirer Staff Writer. Study says doctors increasingly fill prescriptions. The Inquirer. July 19, 2012. Available at:
  7. American Academy of Urgent Care Medicine. Available at:
  8. National Conference of State Legislatures. Available at:
  9. International Myeloma Foundation. Equal access under the law. Available at:

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