Pharmacy and Therapeutics Committee and the Formulary System

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ASHP Report

ASHP Guidelines on the Pharmacy and Therapeutics Committee and the Formulary System

management within the context of a have policy statements on the use of Am J Health-Syst Pharm. 2021;78:907-918 hospital or health system. Pharmacist formularies.2-8 These guidelines focus Downloaded from https://academic.oup.com/ajhp/article/78/10/907/6224888 by ASHP Member Access, [email protected] on 10 June 2021 Christy Ciccarello, PharmD, MHA, responsibilities and roles in managing on the use of formulary systems in hos- Vice President, Clinical Pharmacy Services, Novant Health, Winston-Salem, the formulary system in partnership pitals and health systems, in both in- NC, USA with other healthcare professionals patient and outpatient settings. Molly Billstein Leber, PharmD, BCPS, are embedded throughout. These FASHP, Associate Director, Drug Use guidelines also provide assistance to Evolution of formularies Policy and Formulary Management, Yale New Haven Health System, New Haven, pharmacists in the organization and Formulary systems have evolved CT, USA operation of the pharmacy and thera- over time. Early formularies began as Mandy C. Leonard, PharmD, BCPS, peutics (P&T) committee or equivalent rudimentary drug lists developed by the System Director, Drug Use Policy and body, evaluation of medications for for- military as early as the Revolutionary Formulary Management, Department of Pharmacy, Cleveland Clinic, Cleveland, mularies and consideration of rational War and came into more widespread OH, USA use of medications, and development use during the 1950s.9 Pharmacists, in Todd Nesbit, PharmD, MBA, FASHP, and implementation of strategies to conjunction with their organizations, Director of Pharmacy Patient Care optimize medication use through the developed policies to dispense gen- Services, The Johns Hopkins Health System, Baltimore, MD, USA formulary system. A glossary of terms is eric equivalent drugs when a specific provided in the Appendix A. brand-name drug was prescribed. In Mary G. Petrovskis, PharmD, BCPS, PGY2 Health-System Pharmacy the late 1950s, the ASHP minimum Administration Resident, University of Formulary and standard for pharmacies in hospitals North Carolina Medical Center, Chapel formulary system Hill, NC, USA called for the implementation of a for- A formulary is a continually up- mulary system.10 Emily Pherson, PharmD, BCPS, Assistant Director, Medication Use Policy dated list of available medications During the 1960s, the concept of a & Clinical Informatics, The Johns Hopkins and related information, representing hospital formulary continued to grow. Health System, Baltimore, MD, USA the clinical judgment, resulting from Hospitals developed policies that au- Heidi A. Pillen, PharmD, FASHP, a review of the clinical evidence, of thorized pharmacists to make generic Director of Pharmacy, Clinical Services & Medication Use Policy, Beaumont Health, physicians, pharmacists, and other interchanges in an institutional for- Southfield, MI, USA clinicians in the diagnosis, prophylaxis, mulary system based on prior con- 11 Celia Proctor, PharmD, MBA, Assistant or treatment of disease and promotion sent from physicians. ASHP and the Director, System Formulary Management of health. A formulary includes, but American Hospital Association (AHA) & Integration, The Johns Hopkins Health System, Baltimore, MD, USA is not limited to, a list of medications issued joint statements on the legality of and medication-associated products formularies.12,13 The American Medical Jennifer Reddan, PharmD, FASHP, Pharmacy Executive Director, Excelerate, or devices, medication-use policies, Association (AMA) and the American Vizient, Irving, TX, USA important ancillary drug information, Pharmaceutical (later Pharmacists) decision-support tools, and organiza- Association (APhA) subsequently Address correspondence to Bruce tional guidelines. A formulary system joined with ASHP and AHA to revise Hawkins ([email protected]) is the ongoing process through which the statements.14 In 1965, two signifi- a healthcare organization establishes cant events occurred: (1) Medicare Keywords: formulary, formulary system, pharmacy and therapeutics committee, policies regarding the use of drugs, listed formularies as a reimbursement medication-use evaluation, quality therapies, and drug-related prod- eligibility requirement15 and (2) the improvement, pharmacoeconomics ucts, including medication delivery Joint Commission on Accreditation devices, and identifies those that are of Hospitals (now known as the Joint © American Society of Health-System most medically appropriate, safe, and Commission) included an active P&T Pharmacists 2021. All rights reserved. For permissions, please e-mail: journals. cost-effective to best serve the health committee in its accreditation require- [email protected]. interests of a given patient population.1 ments.16 Even with these actions, for- DOI 10.1093/ajhp/zxab080 Formulary systems are used in many mularies were typically no more than different settings, including hospitals, lists of drugs stocked by the pharmacy. acute care facilities, home care settings, By the 1980s, literature describing Purpose and long-term care facilities, as well as the clinical and economic value of These guidelines outline im- by payers such as Medicare, Medicaid, well-designed formularies emerged. portant considerations and recom- insurance companies, and managed Evidence from the hospital setting mend processes for formulary system care organizations. Many organizations was published first, soon followed by

AM J HEALTH-SYST PHARM | VOLUME 78 | NUMBER 10 | May 15, 2021 907 ASHP Report GUIDELINES ON P&T COMMITTEE AND FORMULARY SYSTEM evidence from the ambulatory care en- healthcare professionals and staff who required to provide COI statements vironment.11 This literature led to more participate in the medication-use pro- to avoid actual or perceived interfer- widespread acceptance of formularies cess, and patient and family engage- ence with evidence-based decisions.23 by providers, payers, and industry.5,17 ment advisors. Some healthcare organizations exclude Today, formulary systems are con- The P&T committee should have healthcare professionals with COIs from

sidered an essential tool for healthcare the following administrative compo- P&T committee membership, whereas Downloaded from https://academic.oup.com/ajhp/article/78/10/907/6224888 by ASHP Member Access, [email protected] on 10 June 2021 organizations to foster interprofessional nents in place to maximize meeting others allow participation in committee efforts to promote the rational use of effectiveness: discussions but prohibit voting on par- medications. Formularies have grown ticular items. Practitioners requesting from simple drug lists to comprehen- • Charter additions or changes to the formulary sive systems of medication-use policies • Role of the P&T secretary and/or should also be required to disclose fi- intended to ensure safe, appropriate, formulary manager nancial relationships with pharmaceut- and cost-effective use of pharmaceut- • Committee and subcommittee(s) re- ical companies, payers and insurance icals in patient care.18 sponsibility and scope companies, and other potential COIs • Process to track attendance to the P&T committee. Management P&T committee • Definition of quorum of COI should be specified in organiza- The P&T committee is generally the • Process to allow (or disallow) delega- tional policies and procedures. medical staff committee responsible tion of vote for managing the formulary system. • Process to appeal committee Managing the The P&T committee provides an evalu- decisions formulary system ative, educational, and advisory service • Defined term limits for members Health systems should develop, to the medical staff and organizational • Process for identifying, disclosing, maintain, and implement a formulary administration in all matters pertaining addressing, and reporting conflicts of management process. This evidence- to the use of available medications. The interest (COIs) based process should not be based P&T committee should be responsible • Policy and procedures solely on economic factors. The for- for overseeing policies and procedures • Approach to voting, including roll call mulary system should have aspects related to all aspects of medication use votes to ensure transparency of financial stewardship incorpor- within an institution. • Scope of committee responsibility ated and be standardized within The P&T committee’s organization (eg, specific site or entire system; integrated health systems when stand- and authority should be outlined in inpatient or outpatient sites; drugs, ardization leads to improved patient the organization’s medical staff bylaws, devices, and biologics) outcomes, safety, and cost-effective- medical staff rules and regulations, and • Process for managing minutes, ness. Decisions on the management of other organizational policies, as appro- agendas, record keeping, and com- a formulary system should be founded priate. The description of organization munication of decisions made on the evidence-based clinical, ethical, and authority becomes even more im- legal, social, logistical, philosophical, portant as healthcare facilities merge quality-of-life, safety, and economic into larger health systems. Other responsibilities of the P&T com- factors that result in optimal patient Typically, P&T committee member mittee include medication-use evalu- care.24-26 The process must include the appointments and voting rights are ation (MUE), adverse drug event active and direct involvement of phys- made based on guidance from the monitoring and reporting, medication icians, pharmacists, and other appro- medical staff and other affected stake- error prevention, medication safety, priate healthcare professionals, as well holders. Voting members may include and development of clinical care plans representatives with expertise in fi- facility medical staff, other prescribers, and medication management ini- nance, law, and informatics. pharmacists, nurses, and administra- tiatives (eg, delegation and practice Management of a formulary tors, and are a representative sample protocols, restrictions, guidelines and system is a significant component of of the organization. If the scope of clinical pathways). Information about a healthcare organization’s ongoing the P&T committee includes a health these activities is available in ASHP medication-use policy development system, site representation needs to be guidelines on the topics.19-22 process. A comprehensive, well- addressed to ensure equitable input Oversight of a formulary system and maintained formulary is tailored to and voting authority from each fa- the capacity to make appropriate formu- the organization’s patient care needs, cility. Additional supporting P&T com- lary decisions requires consideration policy framework, and medication- mittee members may include quality of patient care factors and a thorough, use systems while ensuring alignment improvement managers, medication unbiased review of the biomedical lit- with medication management stand- safety leaders, informaticists, other erature. Voting members should be ards of accrediting organizations.27

908 AM J HEALTH-SYST PHARM | VOLUME 78 | NUMBER 10 | May 15, 2021 GUIDELINES ON P&T COMMITTEE AND FORMULARY SYSTEM ASHP Report

A well-managed formulary system en- • Methods for selection of suitable subcommittees). Panels and subcom- sures a close relationship among the manufacturers for specific medica- mittees are helpful in applying clinical organization’s medication-use policies, tions (ie, the pharmacy department study results to specific patient popu- the therapies offered by the organiza- is responsible for specifications for lations and developing recommended tion, and the medications routinely the quality, quantity, and source of strategies for the safe and effective

stocked in the pharmacy. A formulary supply of all medications, chemicals, use of medications. Subcommittee Downloaded from https://academic.oup.com/ajhp/article/78/10/907/6224888 by ASHP Member Access, [email protected] on 10 June 2021 also identifies those medications that biologicals, and pharmaceutical pre- and panel members can help educate are most medically appropriate and parations used in the diagnosis and groups of clinicians, who ultimately cost-effective to best serve the health treatment of patients)28 drive prescribing behaviors, about interests of the health system’s patient • The process for using nonformulary significant formulary changes. User population. The P&T committee should agents within the hospital and health groups, representing those primarily review all medications (see Appendix A) system affected by the policy, may also be used in the health system. These may in- • The process for managing helpful. clude alternative remedies (herbals and radiopharmaceuticals The P&T committee should have supplements), nonprescription drugs, • The process for managing drug formal interactions (ie, communi- blood derivatives, contrast media, and product shortages cation lines) with other commit- other diagnostic and treatment agents.27 • The process for developing an or- tees whose functions may affect the Institutional policies may need to be ganization or health system–specific medication-use process. These com- created for P&T committee evaluation MUE plan mittees would include those respon- of agents not approved by the Food and • Policies regarding specific sible for developing tools to facilitate Drug Administration (FDA) (eg, herbal medication-use processes (eg, pro- medication use (eg, forms or order set supplements). curement, prescribing, distribution, review committee, computerized pro- The formulary system should re- administration, monitoring, automa- vider order entry committee), those view and approve all policies related tion, and technology) concerned with safety or performance to the medication-use process; all • The process for disseminating improvement (eg, quality improvement medication-use policies, regard- medication-use policies and how or patient safety committees), those less of their origination, should flow users will be educated regarding the involved in developing patient care through the P&T committee. The process policies (eg, medical and nursing com- organization’s medical staff leader- • Process for accountability over medi- mittees), those involved with investiga- ship (ie, the body to which the P&T cation delivery devices (eg, infusion tional medications (eg, investigational committee reports) should complete pumps, dose error reduction soft- review boards), and other commit- the final policy approval. Policy re- ware, intranasal atomizers) tees whose actions may affect medi- view and revision should occur as new • Consideration of medication ac- cation use (eg, nutrition, equipment information becomes available and at cess through prior authorization and supply, and finance committees regularly established intervals (eg, an- processes and patient assistance or patient and family engagement ad- nually). The organization should have programs visors). Recommendations from other medication-use policies that address • Implementation of P&T committee committees, subcommittees of the P&T the following: decisions into the electronic health committee, expert panels, and others record (EHR) should be submitted to the P&T com- • How medications are requested mittee for review. P&T committee de- for addition to or deletion from the A formal process to review medication- cisions on recommendations should be formulary use policies should be in place. This communicated to the recommending • How medications are reviewed for process may include the use of expert group in a timely fashion. addition to or deletion from the for- panels or subcommittees of the P&T Finally, the role of pharmaceutical mulary, including who performs the committee. Expert panels or subcom- company representatives and medical reviews mittees should serve in an advisory role science liaisons in a healthcare organ- • How and when drug class reviews are to the P&T committee, and their mem- ization should be carefully considered. conducted bership should include recognized ex- Organizational guidelines should de- • The process for developing, perts in their areas of practice. The P&T fine appropriate relationships and implementing, and monitoring committee may also find subcommit- interactions with such individuals. At a medication-use guidelines tees that address specific therapeutic minimum, these guidelines should ad- • Methods and policies for ensuring areas to be beneficial (eg, pediatrics, dress the provision of pharmaceutical the safe procurement, prescribing, antimicrobial, oncology therapy, car- samples, indirect or direct funding sup- distribution, administration, and diovascular, adverse drug reaction, port, and educational programming re- monitoring of medications pharmacogenomics, or biotechnology garding formulary and nonformulary

AM J HEALTH-SYST PHARM | VOLUME 78 | NUMBER 10 | May 15, 2021 909 ASHP Report GUIDELINES ON P&T COMMITTEE AND FORMULARY SYSTEM medications. Applications for for- formulary decisions. Various types review, drug-evaluation document).35 mulary additions should be initiated and strengths of evidence (eg, ran- All information provided in the drug- and completed independently by the domized clinical trials, meta-analyses, evaluation document should be refer- requesting healthcare provider and case reports, association consensus enced to the evidence or identified as a not by an industry representative or statements) may be useful in the conclusion supported by evidence. Any

vendor. Refer to ASHP’s Guidelines decision-making process. Although dif- areas of consensus recommendations Downloaded from https://academic.oup.com/ajhp/article/78/10/907/6224888 by ASHP Member Access, [email protected] on 10 June 2021 on Pharmacists’ Relationships with ferent types of evidence are available or opinion should be clearly identified. Industry for more information on ap- for application, those with stronger Formulary status recommendations propriate interactions with industry.29 evidence should be used to drive for- (eg, from drug information services mulary decisions (eg, meta-analyses, or expert groups) may be included Evaluating medications for randomized controlled trials). Other in the drug-evaluation document. inclusion in the formulary types of evidence have a role in the Recommendations should consider the The P&T committee should use decision-making process, however, and formulary status (addition or rejection) a structured, evidence-based pro- may be appropriate when stronger evi- of a medication, as well as the need cess in the evaluation of medications dence is not available. Observational for restrictions, educational efforts, or for formulary consideration. The P&T studies (ie, case-control and cohort policies and procedures to ensure safe committee should be provided with studies), case reports, and consensus and appropriate use within the health information that reflects a thorough, opinions may be valuable even when system. accurate, and unbiased review and stronger evidence is available. Some Pharmacoeconomic assess- analysis of the evidence available in the organizations find it useful to grade ments. Rigorous pharmacoeconomic scientific literature. The evaluation pro- evidence when evaluating formulary evaluations can and should be con- cess should encourage objective con- requests; several tools are available for ducted in some cases when reviewing sideration of clinical and care delivery this purpose.30-34 new medications. These evaluations information, facilitate communication, Published evidence and expert should explicitly state the perspective foster positive patient outcomes, and opinion are not the only resources of the analysis (eg, patient, healthcare support safe and effective medication available to aid in the formulary provider, payer) and should include con- ordering, dispensing, administration, decision-making process. Internal data sideration of all costs and consequences and monitoring. Decisions made by and prescribing and outcomes infor- relevant to that perspective. When the P&T committee should support im- mation may be helpful in formulary new medications being considered are proved patient care outcomes across decision-making. When published data found to be therapeutically equiva- the continuum of care, including con- are not available, it may be appropriate lent to existing alternatives (ie, having siderations regarding patient access to to incorporate expert opinion into the equivalent efficacy and safety), then the medications upon discharge. review process. Experts in practice cost-minimization approach is appro- Evidence-based evaluation. Evi areas sometimes have access to unpub- priate. In these circumstances, it is im- dence-based medicine is a systematic lished data or reports that may offer in- portant to consider costs associated with approach to the evaluation of biomed- sight into difficult formulary decisions. the medication and non–medication- ical literature and application to clinical The formulary decision-making related costs (eg, costs of administration, practice and should be applied to for- process should be guided by an in- monitoring, prolonged hospital stay, op- mulary decision-making for medication dependent review of evidence pub- erational costs, and laboratory test moni- product selection.25 Evidence-based lished in the biomedical literature, toring; costs to patients and providers). decision-making standardizes and im- application of expert opinion, and use While cost-effectiveness analysis proves the quality of patient care and of internal data and benchmarking (evaluating the incremental difference promotes cost-effective prescribing.25,26 programs (see Appendix B for a de- in investment necessary to produce To practice evidence-based medicine, scription of the 4 major types of reviews an incremental difference in clinical practitioners must be proficient in re- used in such evaluations). If a P&T outcome) is another potentially useful trieving, evaluating, and applying the committee uses medication dossiers analytic approach, it is not often used biomedical literature to clinical practice. prepared by a pharmaceutical manu- for formulary decision-making be- Inclusion of a medication on a health facturer, it should do so with the utmost cause of its complexity and need for system’s formulary or the adoption of a caution, since the objectivity of these strong evidence or data. The academic medication-use guideline should reflect documents may be challenged. value of this approach lies in its ability an evidence-based evaluation. Information used in the formu- to show how little (or how much) must Evidence-based decision-making lary decision-making process should be spent to achieve a particular margin incorporates the systematic approach be provided to the P&T committee in of clinical advantage when comparing to reviewing, evaluating, and applying a written document with a standard an alternative that is more expen- the biomedical literature to guide format (eg, a drug monograph, drug sive but safer or more efficacious. No

910 AM J HEALTH-SYST PHARM | VOLUME 78 | NUMBER 10 | May 15, 2021 GUIDELINES ON P&T COMMITTEE AND FORMULARY SYSTEM ASHP Report standards currently exist to determine Even if a formal pharmacoeconomic Strategies for managing what cost is reasonable for a given im- evaluation is not included in a drug medication use provement in outcome; however, it is review document, a financial evalu- Common strategies for managing unreasonable to recommend alterna- ation must be conducted, including medication use via the formulary in- tives of lower quality simply to achieve consideration of site of care, non– clude use of generic drugs, biosimilars, cost savings. This approach can be used medication-related costs, and financial and specialty medications; therapeutic Downloaded from https://academic.oup.com/ajhp/article/78/10/907/6224888 by ASHP Member Access, [email protected] on 10 June 2021 to demonstrate how a decrease in clin- consequences to the pharmacy and to interchange; guided-use policies, clinical outcomes associated with the use the organization as a whole. ical practice guidelines; and MUE. of a less expensive agent can be offset Formulary exceptions. Exclusion Generic drugs. Optimizing the by investing the savings achieved in of a medication from a formulary may af- number of medication entities and other interventions that produce even fect coverage of and access to the medi- products available from the pharmacy greater total benefits. When evaluating cation. In a closed formulary system, for can produce substantial patient care cost-effectiveness, it is important to example, only medications listed on the and financial benefits. These benefits consider the site of care for administra- formulary are covered under the patient’s are greatly increased through the use of tion of the drug. drug benefit. Regardless of health-system generic equivalents (drugs considered Cost-utility evaluations (evaluating setting, the formulary system should in- bioequivalent by FDA [ie, AB-rated drug the incremental difference in include an exception process that provides products42]). The use of generic equiva- vestment necessary to produce an prescribers and patients with timely lents is encouraged in order to provide incremental difference in quality-of- access to medications that are not on the best possible care at an affordable life-adjusted clinical outcome [eg, in- the formulary but are medically ne- cost. Use of generic drugs that have been cremental cost per quality-adjusted cessary for the care of the patient. The deemed bioequivalent by FDA does not life-years gained for one medication underlying principle for such a process require review or approval by the P&T vs another]) may also be beneficial by is that unique patient needs may not be committee, although a review of all new serving to reflect patient preference in satisfied by use of the formulary medi- generic medications for key safety issues formulary decision-making. However, cations. The formulary exception pro- (eg, look-alike, sound-alike concerns) the same concerns related to the use of cess should generate information on should be conducted to prevent medi- cost-effectiveness evaluations apply to nonformulary medication use that will cation errors when possible. For some 36-38 this approach. enable the P&T committee to evaluate drug categories, such as those with a Decision analysis models incorpo trends in such use. Criteria for approval narrow therapeutic range, a more thor- rating local data can be employed when of nonformulary medications should be ough evaluation of the bioequivalency published pharmacoeconomic data are developed (eg, allergy to or therapeutic data and approval of experts or the P&T limited or unavailable. Probabilities for failure of formulary alternative, condi- committee should be considered before each outcome can be extracted from tion not treatable by formulary medi- implementing a generic substitution. the published literature or drawn from cations) and guidelines for use should The P&T committee should estab- local data sources, which would pro- be considered for nonformulary medi- lish policies and procedures governing vide a more relevant local perspective cations if they carry patient safety risks, the dispensing of generic equivalents on outcomes. Costs associated with have a Risk Evaluation and Mitigation when branded products are ordered. medications and outcomes should re- Strategy (REMS), are expensive, and re- These policies and procedures should flect those of the healthcare system. quire complicated preparation. include the following points: Pharmacoeconomic analyses pub- Subformularies. Depending on lished in the medical literature or pro- state regulations, subformularies may • The pharmacist is responsible for vided in the manufacturer’s formulary be developed and maintained, using selecting from available generic dossier should be analyzed carefully be- the same evidence-based process, to equivalents those drugs to be dis- fore being included as part of the review provide lists of appropriate and ap- pensed pursuant to a prescriber’s process. Particular attention should be proved medications for furnishing by order for a particular medication. paid to the assumptions made in these nonphysician providers or to specific • The prescriber has the option, at the studies. In many situations, assump- patient subsets, such as Medicare pa- time of prescribing, to specify the tions made to simplify economic studies tients. Health systems must follow spe- brand or supplier of the drug to be dis- are not valid in particular institutions. cific rules and regulations provided pensed for that particular medication Institution-specific costs are often dif- under the Medicare Modernization order if considered clinically justified. ferent from the costs used in published Act of 2003 in their evaluation and in- • The prescriber’s decision should be studies, and local data should be used clusion of medications in a Medicare based on pharmacologic or thera- when incorporating their results into formulary for those medications to be peutic considerations (or both) rela- medication reviews.39,40 covered.41 tive to that patient.

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Biosimilars. A biosimilar is a bio- policies, or protocols within a formu- resistant organisms and pose a danger logical product that is highly similar to lary system.1,44 Drugs appropriate for to the general patient population or and has no clinically meaningful differ- therapeutic interchange are drug prod- the public. Alternatively, ordering of a ences from an existing FDA-approved ucts with different chemical structures specific medication may be limited to reference product.43 Several entities that are expected to have similar thera- a specific group of prescribers (eg, re-

have been approved as biosimilars by peutic effects and safety profiles when stricting use of chemotherapy agents to Downloaded from https://academic.oup.com/ajhp/article/78/10/907/6224888 by ASHP Member Access, [email protected] on 10 June 2021 FDA, and inclusion of these products administered to patients in therapeut- oncologists). on formulary should be considered ically equivalent doses. Therapeutic Designating medications for use as a strategy for management of the interchange provides pharmacists in specific areas. Such policies can be medication-use system. Biosimilars are with the authorization to use a formu- helpful when administration of a medi- not generically equivalent to the refer- lary therapeutic alternative in place cation requires special equipment or ence product, so the P&T committee of a nonformulary medication or a staff with particular skills to use the should be involved in the decision to in- nonpreferred formulary medication medication safely (eg, limiting neuro- clude these products on formulary. The without having to contact the prescriber. muscular blockers to operating rooms implications for patients must also be Ideally, therapeutic interchanges are and critical care areas). considered, including legal and regu- built into the EHR to allow for seam- Approval of medical director (or latory restrictions, coverage and reim- less substitution of formulary products. designee) before drug use. This strategy bursement models of payers, differences A process should be established for is particularly appropriate when the in clinical indications or activity between when the prescriber wishes to opt out of P&T committee has reviewed a high- the reference product and the biosimilar, the interchange. Adequate educational cost medication and determined that and contractual obligations. initiatives should be undertaken to en- the drug has little or no role in the care There are several considerations sure that everyone affected (prescribers, of patients at that organization but a pre- when evaluating biosimilars. When patients, pharmacists, nurses, and other scriber would like to use the medication there are multiple biosimilars avail- healthcare professionals) is notified of on a nonformulary basis. This strategy able for the same reference product, the therapeutic interchange. may also be used as an approval pathway a close review of indications for each Guided-use strategies. Medi for medications requested for use out- of the biosimilars should occur, as the cations may be added to the formulary side of established criteria outlined in indications that each biosimilar has with additional processes in place to the formulary. may differ compared to each other guide the use of the medications to im- Clinical practice guidelines. and the reference product. FDA can prove therapeutic outcomes, prevent Clinical practice guidelines are devel- deem a biosimilar as interchangeable, adverse events, or reduce costs. All guide- oped and disseminated by national however, even if a product does not lines for use for both on- and off-label and international organizations, but have this status noted in its labelling. indications should be developed using they can also be developed locally. Available switching data should be re- evidence-based decisions, based on the Whether the medication formulary is viewed closely to determine whether current medical literature.45 Examples of a reflection of existing clinical prac- patients currently receiving treat- strategies to help guide the use of medi- tice guidelines in a particular organ- ment with the reference product can cations may include the following. ization or vice versa, it is critical that be switched to the biosimilar. In in- Established-use criteria. Patients the guidelines and formulary are con- stances in which FDA has determined must meet the established criteria before sistent. If a specific medication is re- a biosimilar product to be interchange- the medication is dispensed. A process commended by a clinical practice able, state regulations should be re- should be developed to cover situations guideline, it should in the majority of viewed to determine actions required in which the patient does not meet the cases be on the formulary. As formulary by the pharmacist when dispensing established criteria but the medication changes are made, agents may need to a biosimilar with an interchangeable is nevertheless determined to be med- be removed from or replaced in existing status. In instances in which an institu- ically necessary. This strategy may also guidelines. Guidelines should avoid tion may elect to have both a reference be useful when medications are in short recommending use of nonformulary product and a biosimilar on formulary, supply. medications, and they can be useful in careful attention should be paid to how Restricting drug use by specialty discouraging nonformulary medication these are built in the EHR to ensure the service. A specific service must approve use and guiding the appropriate use of appropriate product is utilized. the use of the drug before dispensing. formulary products when necessary. Therapeutic interchange. Ther This strategy can be used when inappro- Guidelines are frequently devel- apeutic interchange is the authorized priate use or severe adverse effects may oped to address complex or particu- exchange of therapeutic alternatives occur, and it can also be employed for larly expensive medication therapies. in accordance with previously estab- antimicrobial agents when inappro- However, complicated specialty ther- lished and approved written guidelines, priate use or overuse can result in apies that will affect the care of very

912 AM J HEALTH-SYST PHARM | VOLUME 78 | NUMBER 10 | May 15, 2021 GUIDELINES ON P&T COMMITTEE AND FORMULARY SYSTEM ASHP Report few patients may not justify the time to the site of care for patient adminis- Incorporating patient and resources necessary to develop tration (white bagging) or to the patient, safety issues in the and maintain a guideline. Guidelines who then carries it to the site of care decision-making process may be medication specific or disease for administration (brown bagging). The P&T committee should system- oriented and may overlap in their scope Another strategy to consider in man- atically address medication and patient of coverage. agement of specialty pharmaceuticals safety issues as part of its deliberations. Downloaded from https://academic.oup.com/ajhp/article/78/10/907/6224888 by ASHP Member Access, [email protected] on 10 June 2021 The development of a clinical prac- is clear bagging. Clear bagging is the The P&T committee should ensure that tice guideline should begin with the delivery of a patient-specific specialty medication-use policies adequately ad- synthesis of all available biomedical pharmaceutical directly from a health dress potential risk and safety issues. evidence addressing the guideline system’s specialty pharmacy directly to Hospital or health-system medication- topic. In many cases, guidelines from the health-system site of service, where event data, including near misses, 47 other organizations, both national and it is then administered. should consistently be reviewed by the local, can be used as a starting point MUE process. MUE is a quality P&T committee, along with recom- for development. The subsequent con- improvement activity, but it can also be mendations to prevent future events. sensus process, eliciting feedback and considered a formulary system manage- The P&T committee should also review input from local stakeholders, is crit- ment technique. MUEs have tradition- available information on medication or ical. Data from the organization should ally involved evaluating evidence-based patient safety events reported by other be used to make informed decisions criteria to determine the health system’s organizations to identify ways to pre- during the consensus process. After the compliance with established standards. vent medication events and disseminate consensus process is completed, the Interventions could then be used to im- the information to healthcare providers guideline should be reviewed and approve any aspect of the medication-use and, when appropriate, patients. proved by the P&T committee. process based on MUE data analyses. When evaluating a medication for The dissemination and implemen- MUE can be simply informative inclusion on the formulary, the P&T tation of guidelines in the practice (collecting data to guide decision- committee and its supporting sub- environment must also be carefully making) or used to measure the effect committees or panels should consider executed. Communication about the of interventions, such as the addition adverse effects, preparation issues, availability of guidelines is necessary. of a new agent to the formulary or the sound-alike or look-alike potential, Guidelines should be readily available implementation of a new medication- practitioner safety, and dosing or ad- through existing health-system plat- use policy. While MUE often focuses ministration issues. If a product has a forms. If feasible, it is recommended on problem-prone, high-risk, or high- REMS program, the requirements of this to build the guidelines into the compu- cost medications, MUE can be used program should be carefully reviewed terized provider order entry system (eg, to examine any aspect of medication to ensure the institution can meet the through order set creation) to facilitate use that is problematic to the insti- requirements. When implementing the appropriate care of the patient. tution conducting the evaluation. formulary decisions for medications Every guideline should include a time Medications recently added to the for- that have REMS, there should be pro- frame for future review and revision. mulary should be evaluated, especially cesses in place to ensure compliance If utilization of a medication is being if there is the potential for inappro- both during implementation and on an requested outside established health- priate use or adverse effects. This re- ongoing basis. Proactive assessments system guidelines for appropriate use, view should occur 6 to 12 months after should be conducted to identify poten- scientific evidence to support safety their addition to the formulary. High- tial safety concerns posed by use of the and efficacy should be provided and re- cost, high-use, or problem-prone medication, and proposed strategies viewed to substantiate the request. medications and outcomes of specific to mitigate those risks should be im- Specialty medications. P&T disease states are also good candidates plemented by the P&T committee. In committees should be involved in the for evaluation. addition, quality improvement projects organization’s approach to managing A systematic plan to monitor, to improve the safety of specific medi- specialty medications to ensure the evaluate, and improve medication use cations or to evaluate the processes pharmacy has the ability to provide should be established within the organ- involved should be conducted and re- 19 medications in a timely manner, to ization. Such a plan is an accreditation viewed by the P&T committee. The P&T support patient access to medications, requirement for many organizations committee should champion evidence- 27 and provide continuity of care. ASHP (eg, Joint Commission ). The P&T based fail-safe techniques (eg, bar has resources to aid in specialty phar- committee, or its equivalent, should be coding) to prevent medication events. macy management, including the involved in the MUE process. Refer to Resources that provide informa- ASHP Specialty Pharmacy Resource ASHP’s Guidelines on Medication Use tion on medication or patient safety 46 Guide. This guide provides guidance Evaluation for more detailed informa- events include the Institute for Safe 19 on dispensing the medication directly tion conducting an MUE. Medication Practices (www.ismp.org)

AM J HEALTH-SYST PHARM | VOLUME 78 | NUMBER 10 | May 15, 2021 913 ASHP Report GUIDELINES ON P&T COMMITTEE AND FORMULARY SYSTEM and Medwatch. The Joint Commission, preparation, administration, moni- policy should be integrated directly Institute for Healthcare Improvement, toring, and education. into the therapeutic decision-making and National Center on Patient Safety During a drug product shortage, processes that guide the use of a medi- provide information about conducting the P&T committee plays an important cation during order entry or incorpor- and examples of failure mode and ef- role. The P&T committee needs to de- ated into a diagnosis-specific electronic

fects analysis (FMEA) projects on their velop strategies to address shortages in treatment plan. Other specific ways of Downloaded from https://academic.oup.com/ajhp/article/78/10/907/6224888 by ASHP Member Access, [email protected] on 10 June 2021 websites (www.jointcommission.org/, a timely manner, including designating communicating information about a www.ihi.org/, and www.patientsafety. appropriate therapeutic alternatives, medication-use policy may include the va.gov). identifying strategies for mitigating use of use of available drug product, and Implementation of formulary establishing use restrictions. All of • Inservice education, decisions into the EHR these strategies should be developed • Facility-approved social media, Use of the EHR to implement, based on available literature and best • Grand rounds, guide, and evaluate decisions made practices. Therapeutic interchange • Communication between pharmacists by the P&T committee is essential. can be useful in dealing with critical and prescribers EHR technology functionality should drug product shortages. The P&T com- • Staff meetings, be maximized to support drug policy mittee should work collaboratively with • E-mail, and formulary management decisions. other committees and departments, • Electronic newsletters, The EHR should provide guidance on such as specific medical departments, • Prescriber detailing, and dosing, monitoring, and restrictions/ nursing, and risk management (when • Pharmacy or institutional websites. limitations at the point of prescription necessary) to develop effective man- and verification. A standard process, agement plans for addressing short- Outcome-driven projects may be including established expectations ages. Given the dynamic nature of drug beneficial in illustrating the value of a for timeliness, should be developed shortages, it is not always possible to new medication-use policy and sup- to consistently and efficiently imple- obtain approval from P&T committee port further expansion. ment these decisions into the EHR. members prior to implementation of Multihospital systems and integrated strategies if there is a need for urgent Reimbursement strategies delivery networks that share the same changes. To make sure the P&T com- and considerations EHR platform and formulary review mittee is aware of all changes related to New payment models require that process should centralize the coord- drug shortages, organizations should P&T committee members are astute ination of implementation.48 EHR include a drug shortage update as a in their understanding of the hospital implementation efforts should be co- regular agenda item for the P&T com- and health system’s payment policies ordinated with operational changes mittee. Communication with patients and reimbursement strategies related and education requirements identi- and staff is crucial to effectively manage to medications. A balanced approach fied in the decision-making process. shortages. to managing a hybrid reimburse- Finally, resources and personnel avail- Effective integration of these strat- ment structure between traditional able to support implementation into egies into the EHR is key for successful fee-for-service models and emerging the EHR should interface with the P&T implementation of a drug shortage value-based contracts will be re- committee to ensure understanding plan. Various strategies exist for com- quired. Financing and reimbursement and shared expectations of the EHR munication in the EHR, including pla- for medications is complex; hospitals technology functionality. In addition, cing electronic alerts on medications, and health systems can no longer ex- key content experts charged with blocking the ordering of medications clusively focus on manufacturing con- evaluating and proposing drug policy on shortage, and facilitating the build of tracts, wholesaler agreements, and and formulary management decisions new medication records or order sets to inpatient reimbursement. Large health should collaborate with informatics guide use of alternative agents during systems and integrated systems must personnel on the design and validation the time of the shortage. consider implications of medication re- of EHR content. More information about managing imbursement by Medicare, Medicaid, drug product shortages can be found commercial, and private payers. If ap- Drug product shortages in the ASHP Guidelines on Managing plicable, 340B Drug Pricing Program Health systems frequently need to Drug Product Shortages.49 policies must also be considered. address drug product shortages. Drug Prior to approval of high-cost drugs, product shortages disrupt patient care Implementing medication-use in collaboration with the finance de- and impact all aspects of the medication- policies partment, there should be a benefits use system, including purchasing, Various tools can be used to im- investigation conducted, factoring in storage, automation systems, the EHR, plement medication-use policies. The local payer mix, plans for financial

914 AM J HEALTH-SYST PHARM | VOLUME 78 | NUMBER 10 | May 15, 2021 GUIDELINES ON P&T COMMITTEE AND FORMULARY SYSTEM ASHP Report monitoring, and payer negotiations. challenge that organizations need to 2. American Heart Association. American The organization should have a de- address. Heart Association policy statement fined process and responsible depart- on drug formularies. Published 2018. Accessed October 14, 2020. https:// ment for validating reimbursement of Acknowledgments www.heart.org/-/media/files/about-us/ therapy and financial outcomes over ASHP gratefully acknowledges the fol- policy-research/prevention-nutrition/

time. Factors include site of care de- lowing organizations and individuals for re- drug-formulary-statement-2018.pdf Downloaded from https://academic.oup.com/ajhp/article/78/10/907/6224888 by ASHP Member Access, [email protected] on 10 June 2021 cisions in determining where a medi- viewing these guidelines (review does not 3. American College of Physicians. imply endorsement): American Pharmacists cation will be administered. Each Position paper: therapeutic substitution Association (APhA); Maryland Society and formulary systems. Published 1990. organization should have policies on of Health System Pharmacists (MSHP); Accessed October 14, 2020. https:// the use of medications not directly pro- Thomas S. Achey, PharmD, MS, BCPS; Ryan www.acponline.org/acp_policy/pol- cured by the hospital pharmacy. For C. Costantino, PharmD, MA, BCPS, BCGP; icies/therapeutic_substitution_formu- example, some specialty medication Katie Foster, PharmD, MS, FCCM; Rena lary_systems_1990.pdf Gosser, PharmD, BCPS; Kathleen M. Gura, payer agreements circumvent trad- 4. Laing R, Tisocki K. How to develop a PharmD, BCNSP, FASHP; Charzetta H. James, national formulary based on the WHO itional buy-and-bill dispensing chan- PharmD, CPh, MBA, MHA, FACHE, PRS; model formulary. Published 2004. nels and instead use white or brown Isha John, PharmD, MBA (APhA); Indrani Accessed October 14, 2020. http://arch- bagging strategies.47 Furthermore, pa- Kar, PharmD; Nicole Kiehle, PharmD, BCPS ives.who.int/EMLib/docs/National_ tient access to medications upon dis- (MSHP); Eric C. Kutscher, PharmD, MBA, MF_Manual2004-8.pdf FASHP; Patrick M. Malone, PharmD, FASHP; charge or during transitions of care 5. American Medical Association. Policy Nancy MacDonald, PharmD, BCPS, FASHP; H-125.991: drug formularies and between care settings needs to be Kathryn Clark McKinney, PharmD, MS, therapeutic interchange. Accessed evaluated, and systems need to be in BCPS, FACHE, FASHP; Valerie Dee Nolt, October 14, 2020. https://policysearch. place to ensure continuity of medica- PharmD, BCPPS; James Ponto, MS, BCNP, ama-assn.org/policyfinder/detail/ tion use and to decrease the potential FASHP; Preetham Talari, MD, FACP, SFHM; formulary?uri=%2FAMADoc%2FHOD. Philip J. Trapskin, PharmD, BCPS; Tyler to prolong length of stay due to medica- xml-0-227.xml A. Vest, PharmD, MS, BCPS; Geralyn Waters, 6. American Medical Association. tions initiated during an inpatient stay PharmD, BCPS; Jody Jacobson Wedret, RPh, Policy H-285.965: managed care cost that may be restricted elsewhere. FASHP, FCSHP. containment involving prescription ASHP also gratefully acknowledges the drugs. Accessed October 14, 2020. Conclusion contributions of authors of previous versions https://policysearch.ama-assn.org/ of these guidelines: Linda S. Tyler, PharmD, policyfinder/detail/drug%20formu- A formulary system is the multi- FASHP; Mirta Millares, PharmD, FCSHP, laries%20?uri=%2FAMADoc%2FHOD. disciplinary, evidence-based process FASHP; Andrew L. Wilson, PharmD, FASHP; xml-0-2089.xml employed by an organization to select Lee C. Vermeulen Jr, BSPharm, MS; J. Russell 7. Academy of Managed Care Pharmacy. (Rusty) May, PharmD, FASHP; Michael and use medications that offer the best AMCP format for formulary submis- A. Valentino, RPh, MHSA; and Sabrina sions. Accessed June 3, 2019. http:// therapeutic outcomes while minim- W. Cole, PharmD. www.amcp.org/practice-resources/ izing potential risks and costs for pa- amcp-format-formulary-submissions/ tients. Organizations should employ 8. American Academy of Family Disclosures the MUE process to continually im- Physicians. Patient-centered formu- The authors have declared no potential con- prove how medications are used within laries. Accessed October 14, 2020. flicts of interest. https://www.aafp.org/about/policies/ the organization at all steps in the all/patient-formularies.html medication-use process. Medication Additional information 9. Balu S, O’Connor P, Vogenberg FR. use is an inherently complex process Contemporary issues affecting P&T Developed through the ASHP Council on committees. Part 1: the evolution. P T. that requires constant evaluation. Pharmacy Practice and approved by the 2004;29:709-711. Organizations need to implement all ASHP Board of Directors on November 16, 10. American Society of Hospital 2020. These guidelines supersede the ASHP necessary tools and processes to meet Pharmacists. Minimum standard for Guidelines on the Pharmacy and Therapeutics the goals of safe and effective medica- pharmacies in hospitals. Am J Hosp Committee and the Formulary System dated tion use. Professionals involved in the Pharm. 1958;15:992-994. January 28, 2008, and the ASHP Statement on 11. May JR. Formulary systems. In: medication-use process need to know the Pharmacy and Therapeutics Committee DiPiro JT, ed. Encyclopedia of Clinical and understand how the organization’s and the Formulary System dated June 10, 2008. Pharmacy. Marcel Dekker; 2002. medication-use policies and processes 12. Willcox AM. The legal basis of the can be incorporated into their daily References formulary system. Am J Hosp Pharm. work to ensure medications are used 1. Principles of a sound drug formu- 1960;17:603-608. appropriately and safely. Technology lary system. In: Hawkins B, ed. Best 13. American Society of Hospital offers many opportunities to make Practices for Hospital and Health-System Pharmacists, American Hospital Pharmacy: Positions and Guidance Association. Statement of guiding those processes more effective and ef- Documents of ASHP. American principles on the operation of hos- ficient. Communicating the actions re- Society of Health-System Pharmacists; pital formularies. Am J Hosp Pharm. lated to medication use is a constant 2018:233-236. 1960;17:609-610.

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14. American Society of Hospital for Information Management. Applied the literature. Am J Health-Syst Pharm. Pharmacists, American Hospital Therapeutics Inc; 1998:8.1-8.43. 1999;56:1630-1638. Association, American Pharmaceutical 26. Nakahiro RK, Ho SS, Okamoto MP. 40. Ofman JJ, Sullivan SD, Neumann PJ, Association, et al. Statement of guiding Concepts of pharmacoeconomics. et al. Examining the value and quality of principles on the operation of hos- In: Millares M, ed. Applied Drug health economic analyses: implications pital formularies. Am J Hosp Pharm. Information: Strategies for Information of utilizing the QHES. J Manag Care

1964;21:40-41. Management. Applied Therapeutics Inc; Pharm. 2003;9:53-61. Downloaded from https://academic.oup.com/ajhp/article/78/10/907/6224888 by ASHP Member Access, [email protected] on 10 June 2021 15. Social Security Administration. 1998:7.1-7.37. 41. U.S. Medicare Prescription Drug, Conditions of participation for 27. The Joint Commission. Comprehensive Improvement, and Modernization Act hospitals. Am J Hosp Pharm. Accreditation Manual for Hospitals. The of 2003. Pub L No. 108-173. 1966;23:179-180. Joint Commission; April 2018. 42. Food and Drug Administration. 16. Lammy PP, Flack HL. Pharmacy and 28. ASHP guidelines for selecting pharma- Approved Drug Products with therapeutics committee, consent, and ceutical manufacturers and suppliers. Therapeutic Equivalence Evaluations the hospital formulary. Am J Hosp Am J Hosp Pharm. 1991;48:523-524. (Orange Book). Accessed October 4, Pharm. 1966;23:662-672. 29. American Society of Hospital 2020. www.fda.gov/cder/ob/ 17. American Medical Association. AMA Pharmacists. ASHP guidelines on phar- 43. Food and Drug Administration. policy on drug formularies and thera- macists’ relationships with industry. Am Biosimilars. Accessed October 4, peutic interchange in inpatient and J Hosp Pharm. 1992;49:154. 2020. https://www.fda.gov/drugs/ ambulatory patient care settings. Am J 30. Briss PA, Zaza S, Pappaioanou M, et al. therapeutic-biologics-applications-bla/ Hosp Pharm. 1994;51:1808-1810. Developing an evidence-based guide biosimilars 18. Heindel GA, McIntyre CM. to community preventive services— 44. Gray T, Bertch K, Galt K, et al. Contemporary challenges and novel methods. Am J Prev Med. 2000;18(suppl Guidelines for therapeutic inter- strategies for health-system formulary 1):35-43. change—2004. Pharmacotherapy. management. Am J Health-Syst Pharm. 31. Atkins D, Best D, Briss PA, et al. 2005;25:1666-1680. Accessed October 2018;75:556-560. Grading quality of evidence and 4, 2020. https://www.accp.com/docs/ 19. American Society of Health-System strength of recommendations. BMJ. positions/guidelines/Pharm2511_ Pharmacists. ASHP guidelines on 2004;328:1490-1498. ACCP-TherapIntchg.pdf medication-use evaluation. Published 32. Guyatt G, Gutterman D, Baumann MH, 45. American Society of Hospital 2020. Accessed October 14, 2020. et al. Grading strength of evidence of re- Pharmacists. ASHP statement on the https://www.ashp.org/-/media/assets/ commendations and quality of evidence use of medications for unlabeled uses. policy-guidelines/docs/guidelines/ in clinical guidelines: report from an Am J Hosp Pharm. 1992;49:2006-2008. medication-use-evaluation-current. American College of Chest Physicians 46. American Society of Hospital ashx task force. Chest. 2006;129:174-181. Pharmacists. ASHP Specialty Pharmacy 20. American Society of Health-System 33. Harbour R, Miller J. A new system Resource Guide. Accessed October 4, Pharmacists. ASHP guidelines on ad- for grading recommendations in 2020. https://www.ashp.org/-/media/ verse drug reaction monitoring and evidence based guidelines. BMJ. assets/pharmacy-practice/resource- reporting. Am J Health-Syst Pharm. 2001;323:334-336. centers/specialty-pharmacy/specialty- 1995;52:417-419. 34. Corman SL, Skledar SJ, Culley CM. pharmacy-resource-guide.ashx 21. American Society of Health-System Evaluation of conflicting litera- 47. McCain J. Part I: distribution models for Pharmacists. ASHP guidelines on ture and application to formulary biologics and other specialty pharma- preventing medication errors in decisions. Am J Health-Syst Pharm. ceutical products. Biotechnol Healthc. hospitals. Am J Health-Syst Pharm. 2007;64:182-185. 2012;9:8-13. 2018;75:1493-1517. Accessed October 35. Sterné SC, Uchida KM, Iteen SA. 48. Knoer SJ, Riffle AR. Multihospital health 14, 2020. https://www.ashp.org/-/ Improving the presentation of drug systems: seize the opportunity. Am J media/assets/policy-guidelines/docs/ information to pharmacy and thera- Health-Syst Pharm. 2018;75(7):423-429. guidelines/preventing-medication- peutics committees for formulary 49. ASHP guidelines on managing drug errors-hospitals.ashx decisions. Am J Health-Syst Pharm. product shortages. Am J Health-Syst 22. American Society of Health-System 1996;53:1162-1164. Pharm. 2018;75: 1742-1750. Accessed Pharmacists. ASHP guidelines on the 36. Reeder CE. Overview of October 4, 2020. https://www.ashp. pharmacist’s role in the development, pharmacoeconomics and pharma- org/-/media/assets/policy-guidelines/ implementation, and assessment of ceutical outcomes evaluations. Am J docs/guidelines/managing-drug- critical pathways. Am J Health-Syst Health-Syst Pharm. 1995;52(19)(suppl product-shortages.ashx Pharm. 2004;61:939-945. 4):S5-S8. 50. Jamison DT, Breman JG, Measham AR, 23. Brennan TA, Rothman DJ, Blank L, et al. 37. Drummond MF, Sculpher MJ, et al, eds. Priorities in Health. Health industry practices that create Torrance GW, et al. Methods for the Chapter 3: Cost-Effectiveness Analysis. conflicts of interest: a policy proposal Economic Evaluation of Health Care International Bank for Reconstruction for academic medical centers. JAMA. Programmes. 3rd ed. Oxford University and Development/World Bank; 2006. 2006;295:429-433. Press; 2005:137-189. 51. Robinson R. Cost-utility analysis. BMJ. 24. Nair KV, Ascione FJ. Evaluation 38. Gold MR, Siegel JE, Russell LB, et al, 1993;307(6908):859-862. doi:10.1136/ of P&T committee performance: eds. Cost-Effectiveness in Health and bmj.307.6908.859 an exploratory study. Formulary. Medicine. Oxford University Press; 52. Centers for Medicare & Medicaid 2001;36:136-146. 1996:176-213. Services. Electronic health records. 25. Nakahiro S. Contemporary issues in 39. Sanchez LA. Applied Accessed October 14, 2020. https:// formulary management. In: Millares M, pharmacoeconomics: evaluation and www.cms.gov/Medicare/E-Health/ ed. 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Appendix A—Glossary radioactive medications, respiratory play an integral part in the preparation of terms therapy treatments, parenteral nutrition, and presentation of the drug review Cost-Effectiveness Analysis. blood derivatives, and intravenous so- document to the pharmacy and thera- A method for assessing the gains in lutions (plain, with electrolytes and/or peutics (P&T) committee. health relative to the costs of different drugs); and any product designated by New drug monographs. When 50 health interventions. the Food and Drug Administration (FDA) the Food and Drug Administration (FDA) Downloaded from https://academic.oup.com/ajhp/article/78/10/907/6224888 by ASHP Member Access, [email protected] on 10 June 2021 Cost Utility Analysis. A com- as a drug. This definition of medication approves a new drug for marketing that parison of the costs of different proced- does not include enteral nutrition solu- is relevant to the health system, a drug ures with their outcomes measured in tions (which are considered food prod- monograph should be prepared for for- “utility based” units—that is, units that ucts), oxygen, and other medical gases.27 mulary consideration by the P&T com- relate to a person’s level of well-being Medication-Use Evaluation. mittee. New chemical entities warrant and are most often expressed as quality A systematic and interdisciplinary per- a thorough evaluation and a written adjusted life year(s).51 formance improvement method with an drug monograph. A short (eg, one-page) Electronic Health Record. A overarching goal of optimizing patient summary could be provided along with digital version of a patient’s medical his- outcomes via ongoing evaluation and the full monograph.35 Some organiza- tory that is maintained by the provider improvement of medication utilization.19 tions use an executive summary format. over time, and may include all of the Pharmacy and Therapeutics A new drug that is significantly similar to key administrative clinical data relevant (P&T) Committee. An advisory com- other available therapeutic alternatives to that persons care under a particular mittee that is responsible for developing, may be presented in a more abbrevi- provider, including demographics, pro- managing, updating, and administering ated manner (eg, an abbreviated mono- gress notes, problems, medications, vital a formulary system. Institutions may graph) provided that the P&T committee signs, past medical history, immuniza- refer to this committee by a different or experts agree that the drug is thera- tions, laboratory data, and radiology name.1 peutically equivalent to agents already reports.52 Therapeutic Alternatives. Drug available on the formulary. Formulary. A continually updated products with different chemical struc- Addenda to original mono- list of medications and related informa- tures but of the same pharmacologic graphs used to reevaluate previous tion, representing the clinical judgment or therapeutic class and usually have formulary decisions. Formulary de- of physicians, pharmacists, and other similar therapeutic effects and adverse- cisions may need to be reassessed based experts in the diagnosis, prophylaxis, or reaction profiles when administered to on relevant new information or in light treatment of disease and promotion of patients in therapeutically equivalent of newly marketed drugs or dosage health. doses.1 forms. New data on safety, efficacy, sta- Formulary System: An ongoing Therapeutic Interchange. Au bility, methods of administration, cost, process whereby a healthcare organiza- thorized exchange of therapeutic alter- or pharmacoeconomics may warrant tion, through its physicians, pharma- natives in accordance with previously a reevaluation of the drug or dosage cist, and other healthcare professionals, established and approved written guide- strengths or formulations stocked by the establishes policies on the use of drug lines or protocols within a formulary health system. An addendum to the ori- products and therapies and identifies system.1,44 ginal monograph summarizing the new drug products and therapies that are the Therapeutic Substitution. The information should be developed for most medically appropriate and cost- act of dispensing a therapeutic alter- evaluation by the P&T committee. The effective to best serve the health interests native for the drug product prescribed P&T committee may want to establish of a given patient population.1 without prior authorization of the pre- reassessment dates at the time of formu- Generic Substitution. The sub- scriber. This is an illegal act because lary review so that the committee can re- stitution of drug products that contain only the prescriber may authorize an ex- assess the effect of a formulary decision the same active ingredient or ingredients change of therapeutic alternatives.1 on quality or cost of care. and are chemically identical in strength, Therapeutic class reviews. Appendix B—Drug concentration, dosage form, and route Review of an entire therapeutic class of evaluation process of administration to the drug product drugs should be performed at regular prescribed.1 There are 4 major types of drug reviews: intervals, which may be determined by Medication. Any prescription medi- new drug monographs, reevaluations of the P&T committee or influenced by cations, sample medications, herbal rem- previous formulary decisions, thera- regulatory agencies. A therapeutic class edies, vitamins, nutraceuticals, vaccines, peutic class reviews, and expedited review should include all formulary and or over-the-counter drugs; diagnostic and reviews of newly approved medications. nonformulary medications within the contrast agents used on or administered Because of the expertise and training of class and may include institutional util- to persons to diagnose, treat, or prevent pharmacists (drug information special- ization or outcomes data and newly pub- disease or other abnormal conditions; ists in particular), pharmacists should lished information. Therapeutic class

AM J HEALTH-SYST PHARM | VOLUME 78 | NUMBER 10 | May 15, 2021 917 ASHP Report GUIDELINES ON P&T COMMITTEE AND FORMULARY SYSTEM reviews may lead to formulary removal of a new drug, new indication for a may warrant an expedited review to of therapeutically equivalent drugs or a drug, or reevaluation of a previous for- ensure availability of the drug for pa- change in restriction or guideline status mulary decision. Criteria should be in tients who need it. Likewise, a signifi- for a drug. place to describe when an expedited cant new safety concern may warrant Expedited reviews. A process review is warranted. For example, ap- an expedited review for addition

should be available for the P&T com- proval of a new chemical entity for a of restrictions or removal from the Downloaded from https://academic.oup.com/ajhp/article/78/10/907/6224888 by ASHP Member Access, [email protected] on 10 June 2021 mittee to conduct an expedited review disease with no therapeutic alternative formulary.

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