Using duration-based measures, we found some evidence of benefit associated with reformulation use, although our findings suggest that all reformulations are not created equal. Lexapro users, on average, continued longer than Celexa users, and Paxil CR users continued longer than Paxil users. The difference was larger for Lexapro vs. Celexa, which might be expected since Lexapro is more different from Celexa than Paxil CR is from Paxil. There was no notable difference for Remeron Soltab vs. Remeron. However, given that a dissolvable tablet’s primary potential benefit may be ease of administration as opposed to reduced side effects or improved efficacy, this result may not be surprising.
Reformulation benefits may be unequal across subgroups of antidepressant users. Given the relative clarity of the major depression treatment guidelines on appropriate duration of pharmacotherapy, our findings that Lexapro and Paxil CR users with major depression were more likely to receive guideline-consistent antidepressant duration compared to similar users of the original formulations suggest positive benefit associated with reformulation use for this population. The implications of our results on time to discontinuation for the entire population of reformulation users (not just those with major depression) are less clear, however. Longer use may not be better for all patients, and the indications for antidepressant use are unclear for the approximately two-thirds of users with no recorded MH diagnosis in the previous six months. Some may be individuals with episodic major depression; others may be receiving the reformulation for depression or anxiety symptoms but no clear diagnosis, or even for chronic pain.
Given that we could only document clear benefits for individuals with a diagnosis of major depression (88-91% of antidepressant users in our population), should we expect all reformulation users to derive equal benefit? One could argue that reformulation users are revealing their preference for the reformulation by their willingness to pay the additional costs associated with its use. However, Medicaid recipients typically pay either a nominal or no copayment for each prescription filled and often face either no differential cost or only a very small one if they select a reformulation over its original formulation, so their choice of a reformulation does not involve weighing the full costs and benefits.21
Also, some patients and their physicians may be influenced by manufacturer promotional efforts to select a reformulation even though the expected benefits may not be greater for the patient.
It is also possible that physicians may be doing a careful job of matching reformulations to those patients likely to get greater benefit from them, and thus some potential users would not derive the benefits we documented. We found that patients with difficulty swallowing were more likely to get Remeron Soltab but not the reformulations that must be swallowed. Patients with comorbid depression and anxiety, and thus perhaps more complicated courses of illness, were more likely to use an SSRI reformulation. Reformulation use was more common among patients who recently saw a psychiatrist or were hospitalized, who also may be more likely to have relatively severe or complicated conditions, although it is also possible that psychiatrists are more likely to prescribe new medications or are subject to a greater level of manufacturer promotion. While our results may be somewhat suggestive of some level of matching, we are unable to determine the extent to which good matches are being made as opposed to inefficient matches.
Alternatively, it is also possible that doctors who prescribe reformulations are “better” doctors who may be more successful at convincing their patients to continue an antidepressant until guideline-consistent durations are reached. Our models control for whether the enrollee is being treated by a psychiatrist, but our data do not allow us to distinguish effects of the individual provider or other provider-level characteristics.
Given that we found some evidence of benefit, at least for patients with major depression, how might these benefits compare to the costs of the medications from a societal perspective? Is their value sufficient to warrant their development? According to economic theory, long-run societal marginal costs for reformulations approximate their marginal costs of production (i.e., the manufacturing costs).22
In most cases, a reformulation’s marginal production costs are likely to be similar to those for the original formulation (e.g., the marginal costs of producing one tablet of Paxil are probably similar to the marginal costs of producing one tablet of Paxil CR). The additional R&D costs likely depend on the novelty of the reformulation, although in most cases R&D costs should be lower than for developing an entirely new drug. Also, testing requirements are typically less extensive for reformulations than for new molecules.23
If the societal marginal costs are in fact relatively low, a reformulation that could show even very limited benefits would add value from a societal perspective. If so, the Hatch-Waxman Act provisions governing reformulations may introduce inefficiencies into the market. The law provides incentives for firms to delay reformulation introduction until patent expiration approaches for the original formulation in order to take maximum advantage of the exclusivity extension.24
As a result, release of reformulations for which there is some value is delayed from society’s perspective, and policymakers may wish to reconsider the Hatch-Waxman provisions governing reformulations.
From a payer’s perspective, the value associated with reformulations is less clear. If the government (acting as a payer for Medicare and Medicaid) compared the incremental costs and benefits of reformulations relative to original formulations or other similar drugs (for example, as NICE might do in the UK), it is unclear whether the magnitude of benefits we documented would be sufficient to warrant a decision to cover the reformulation given the current differences in prices that payers typically face. Manufacturers might be willing to negotiate lower prices if the drug might not be covered (as they have done in some cases in the UK) or the government could attempt to target reformulations to those with higher marginal benefits (e.g., Soltab only for those with documented difficulty swallowing) using tools like prior authorization. For employers, coverage of reformulations will depend in part on the labor market and the offerings of similar employers. Payers might also be more willing to cover reformulations if their use offset other health care expenditures, although there is no such evidence to date on offsets.
Several limitations should be noted. First, using claims data to understand medication utilization allows one to study use in a large population treated in real-world settings; however, clinical information is somewhat limited, and MH diagnoses can be undercoded. Claims data do not capture medications not reimbursed by Medicaid, such as free samples. Second, propensity score matching only addresses differences in observable characteristics. There may be unmeasured characteristics that influence selection of one drug or another. Our approach of comparing reformulation users with both contemporaneous and non-contemporaneous users of original formulations helps to address this potential selection, but may not resolve it entirely. Third, we focus on two measures of benefit that are typically associated with improved mental health outcomes. We are unable to capture all potential benefits that could result, such as increased labor market productivity or ease of administration. Fourth, we use data from a single state Medicaid program. Utilization patterns for reformulations may differ in privately-insured or non-dual-eligible Medicare populations.
Our results provide some evidence of benefit for reformulations, although the benefit varies across reformulations and may differ by diagnosis. We also documented racial disparities in receipt of reformulated antidepressants, as blacks were significantly less likely to receive reformulations than whites.25
The fact that some of these medications confer benefits for at least certain subpopulations makes these disparities troubling and highlights the need for research to understand the factors driving them.