The slim hope that the growing opioid addiction crisis could be controlled by restricting access to prescription opioids—the abuse of which has been the starting point for many addicts—is slipping away as illegally manufactured opioid pills (some of them counterfeit copies of legal pills) become more commonly available. The addition of fentanyl to these illegal pills—which attracts some addicts because of a “higher high”—has only compounded the problem, and is the main reason that opioid-related deaths (which include heroin) reached 33,091 in 2015, according to just-released CDC data.  The Drug Enforcement Administration (DEA) has not let up on policing of prescription drug abuse, but the crisis won’t be solved by that alone.
Two key changes have occurred in the drug-abuse recovery field over the past decade: federal law that mandates insurance coverage of addiction therapy; and a grudging acceptance by a larger part of the addiction therapy community that medication-assisted treatment (MAT) works.
Until very recently, most long-term addiction therapy was not funded through private health insurance carriers. Private plans were so reluctant to cover substance abuse therapy—an aversion that took the form of high deductibles, exclusions and severe limitations—that many treatment centers did not even bother accepting insurance at all. All of that changed with the passage of the Mental Health Parity and Addiction Equity Act (MHPAEA), often referred to simply as “the Parity Act,” which became law in 2008 but whose final rule did not go into effect until 2014. The Parity Act requires group health plans to cover mental health and substance abuse disorders on an “equal footing” with other medical and surgical benefits.
The Parity Act, in conjunction with several other government laws, programs and regulatory changes, not to mention evolving societal attitudes toward addiction in general, has had a sweeping impact on the substance abuse treatment industry, according to Kevin Taggart, a managing partner at Mertz Taggart, a healthcare M&A consulting firm based in Atlanta, GA.
“We’ve had several clients who were all private, out-of-pocket pay and had been in business for 10 or 15 years, and then the Parity Act came along and now they’re being funded mostly through out-of-network insurance reimbursement,” says Taggart. “It’s really driven their sales through the roof in a lot of cases.”
That this new reimbursement environment has emerged in the midst of a nationwide opioid addiction epidemic would seem to argue for a bullish position on pharmaceutical firms that manufacture drugs used in MAT. But getting such drugs to patients in need is proving more difficult than just funding them. Private practitioners have been slow to prescribe MAT therapies and the only other venues for receiving such treatment—methadone clinics—are few and far between in rural areas, or in inner-city neighborhoods, which present their own accessibility issues.
Fortunately, new drug distribution models are experimenting with ways to expand these proven treatment methodologies to those caught up in what is now being universally viewed as a national public health crisis.
Medications for the treatment of opioid use disorders include agonists like Dolophine and Methadose (methadone); partial agonists like Subutex, Suboxone and Zubsolv (all buprenorphine); and the antagonist Vivitrol (naltrexone). All of them pretty much have the same mechanism of action: they bind with opioid receptors in the same way as prescription painkillers and heroin but at a slower rate, while also leaving the body more gradually. This creates a “ceiling effect” on the highs and a “basement effect” on the lows.
Increasingly seen as an essential component of any opioid treatment plan, both for patients in withdrawal or to support long-term recovery, these drugs are gaining traction. “When administered in the context of an addiction treatment program, all effectively help maintain abstinence from other opioids, reduce use disorder related symptoms, and reduce the risk of infectious disease and crime,” Director of the National Institute on Drug Abuse (NIDA), Nora Volkow told a Congressional hearing in 2015. 
These medications can only be prescribed under highly regulated circumstances. By federal law, buprenorphine, which gained FDA approval in 2002, can be prescribed by private physicians only after completing an eight-hour training course and obtaining a waiver from DEA. At first, qualified doctors are limited to 30 patients. After a year, they may request federal permission to treat up to a maximum of 275 patients. As of June 2016, about 33,000 physicians have been approved to prescribe buprenorphine.
The other main venue for receiving MAT, methadone clinics, known in the business as opioid treatment providers (OTPs), are also highly regulated. There are approximately 14,000 OTPs operating in 48 states in the US, treating about 350,000 patients. Clinics tend to be concentrated in the country’s most heavily populated areas.
Few realize it but methadone clinics are not limited to dispensing methadone. They can dispense any of the various buprenorphine variations and furthermore are not subject to the patient caps that apply to private physician practices. Although OTPs seldom dispense buprenorphine, a few do. “We’ve got one client for sale that has 500 patients total and 450 are on Suboxone,” says Taggart. “We went in there earlier this year, and it really feels just like a doctor’s office. It’s in a medical building in a nice part of town.”
In addition to regulatory hurdles, MAT therapies also face lingering philosophical pushback from substance abuse programs opposed to any kind of chemical-based treatment whatsoever. Based on the 12-step program that serves as the foundation for Alcoholics Anonymous, the so-called Minnesota model embraced by some treatments requires absolute abstinence from any mood altering substances. Some residential facilities reportedly even deny patients fully caffeinated coffee. While almost no clinicians dispute that psychiatric counseling must be part of any treatment program, there is a growing awareness that patients with severe opioid addictions will benefit from MAT therapy. A widely cited 2015 study found that opioid agonist pharmacotherapy cut the risk of death by overdose among British patients by half when compared to psychological support alone. 
Vast, fragmented and lacking a single federal agency to oversee it, the substance abuse recovery industry is difficult to assess in terms of size. The National Assn. of Addiction Treatment Providers guesses there may be as many as 75,000 different treatment programs operating in the US. Of those, around 14,500 are brick-and-mortar behavioral health and substance abuse facilities, which generate an average of about $1 million annual revenue each. Among facilities, about 80% require patients to adhere to some form of the 12-step model that mandates a “spiritual” component to treatment.  However, more and more such programs are adding MAT to their therapies, as well. (For example, after years of opposition, the world famous Hazelden treatment system adopted MAT in 2012.)
About 81% of treatment facilities are outpatient, 26% are inpatient (“residential”), and 6% are hospital-based inpatient. Roughly 55% are structured as nonprofits and 32% are for-profit, with the remainder funded by state, federal, local or tribal entities. 
The reimbursement requirements mandated by the Parity Act have piqued the interest of for-profit and private equity concerns. Investment dollars are pouring in, M&As abound, and some are calling it a full-scale Wall Street “roll up play.” The Parity Act and its transformation of the industry will likely enhance quality, standardization and measurable outcomes, three characteristics significantly lacking in this unruly space, according to Mark Covall, president and CEO of the National Assn. of Psychiatric Health Systems, but it will take time: “In many ways what I’m describing is just starting to play itself out,” he notes. “It’s still in its early stages.”
Issues at stake
Supporting the Parity Act are a slew of government sanctioned programs, initiatives, laws and regulations aimed at confronting the ongoing opioid epidemic. Congress, FDA and the Surgeon General all have pending efforts, adding to a climate which appears welcoming to the ongoing funding of MAT therapies.
The only possible exception here is the continued level of reimbursement for out-of-network residential treatment facilities. These tend to be high-end establishments located in warm weather states where patients can travel to escape the environments and people contributing to their substance abuse problems. The trouble is that they are expensive, sometimes charging double or triple what in-network facilities charge.
The payer backlash against such facilities is well under way and such programs cannot remain sustainable, according to a white paper published by the Braff Group, a Pittsburgh, PA-based consulting firm: “Despite the longevity it has enjoyed to date, the out-of-network model has always been perched precariously on the razor’s edge of sustainability,” the paper states. “If anything the added visibility of parity only raises awareness of this ‘only in America’ systematic disparity in payments.”
The paper concludes that the gains of the Parity Act “will be disproportionally realized by the more mainstream (i.e., affordable) providers.”
But funding is the not the only issue at stake. Physicians appear to be reluctant to prescribe buprenorphine medications, perhaps feeling uneasy about the possibility of their waiting rooms filling up with drug addicts and the effect that might have on public perception of their practices.
Many critics blame the regulatory patient caps for unmet patient needs. But a recent NIDA study of physicians and addiction specialists certified to provide MAT therapies showed that many prescribers served only a small fraction of the maximum patients allowed by the law. More than 20% of DEA-approved doctors treated three or fewer patients; and fewer than 10% treated more than 75 patients, according to the study.
Hub and spoke
Many in the industry believe that new drug distribution models in which OTPs collaborate with buprenorphine prescribing practitioners to treat opioid-addicted patients could be feasible.
In a series of policy papers developed by the American Association for the Treatment of Opioid Dependence (AATOD) for the Substance Abuse and Mental Health Services Administration (SAMHSA), authors laid out a unique blueprint.  They describe how three states—Vermont, Rhode Island and Maryland— have implemented OTP Health Homes by taking advantage of the Affordable Care Act’s Medicaid Health Home option, which enables states to reimburse agencies for providing care coordination.
This model, called the “Hub and Spoke” model, capitalizes on the lack of patient caps confronting OTPs, and standardizes coordination with the patient’s physician. One author described Vermont’s program this way: “Specializing in the treatment of complex addiction, the regional centers (hubs) provide intensive treatment to patients and consultation support to medical providers (spokes) treating patients in the general practice community.” Such coordination would also provide opportunities to treat potential co-morbid psychiatric problems, the authors add.
However, the uncertain status of the ACA following the recent Presidential election casts a pall over enthusiasm for this model. Its reliance on the ACA’s expanded Medicaid provisions, which even before the election 16 states had already opted out of, would be particularly problematic for any nationwide effort.
There is no avoiding the fact that all currently approved MAT therapies contain opioid agents themselves. Although these drugs will not produce the same euphoria as heroin or painkillers, dependent users will take them over nothing. Despite precautions, buprenorphine medications rate among the nation’s most “diverted” prescription drugs (i.e., sold on the black market, boiled down and injected, exchanged for harder drugs, etc.).
Aware that four out of five opioid addicted patients acquired their habit after taking prescription painkillers, pharmaceutical manufacturers have in recent years developed a spate of abuse deterrent (AD) opioid painkillers, designed to be more difficult to crush, inject or take via intranasal ingestion. Six such AD painkillers have been approved by FDA, the latest being Pfizer’s Troxyca (oxycodone and naltrexone) approved in August 2016. Troxyca is an oxycodone pellet with a naltrexone core. If the medication is crushed, the naltrexone will counteract the opioid’s effect, according to the company.
However, the higher costs of AD painkillers have drawn protests from patients and payers. It is difficult to compete on price with traditional opioids, which have been generics for years.
Another possible way to prevent diversion is through drug secreting implants. In May 2016, FDA approved Probuphine, the first buprenorphine implant for the maintenance of opioid dependence. The implant is designed to provide a constant, low-level dose of buprenorphine for over a period of six months.
Of course, avoiding opioids in pain management altogether seems like a worthy clinical goal as well. Devices designed to treat pain without drugs continue to be an area of experimentation. For example, in October 2016, an observational study presented at the annual meeting of the International Society for Pharmacoeconomics and Outcomes Research (ISPOR) found that non-invasive vagus nerve stimulation effectively treated patients suffering from medically unexplained pain symptoms.
As it has for decades, the development of a non-opioid, synthetic painkiller remains a paramount goal of pain relief research. Boehringer Ingelheim sold off three experimental pain compounds to Baltimore, MD-based Centrexion Therapeutics last year. Centrexion then announced that it would continue clinical trials on an injectable form of synthetic capsaicin (the active ingredient in chili peppers) for the treatment of pain.
In the meantime, clinicians and healthcare policymakers will work with the best tools available, and MAT is increasingly seen as part of that mix. “I don’t know how all of this is going to evolve,” concludes NAPHS President and CEO Covall, “but I do think there needs to be mechanisms to create more availability for MAT therapies. Because they are effective and do very well and we could save a lot of lives.”
- Rudd RA, Seth P, David F, Scholl L. Increases in Drug and Opioid-Involved Overdose Deaths — United States, 2010–2015. MMWR Morb Mortal Wkly Rep 2016;65:1445–1452. DOI: http://dx.doi.org/10.15585/mmwr.mm655051e1
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- Pierce M, et al. Impact of treatment for opioid dependence on fatal drug-related poisoning: a national cohort study in England. Addiction. 2015; 111:298-308
- Substance Abuse and Mental Health Services Administration, Center for Behavioral Health Statistics and Quality. Treatment Episode Data Set (TEDS): 2004-2014. National Admissions to Substance Abuse Treatment Services. BHSIS Series S-84, HHS Publication No. (SMA) 16-4986. Rockville, MD: Substance Abuse and Mental Health Services Administration, 2016.
- Integration of Behavioral Health with Traditional Care is Driving Consolidation within the Industry. Published by Duff & Phelps. Accessed at duffandphelps.com.
- Medication Assisted Treatment Deals Signal a Shift in Addictions M&A. Published the Braff Group. Accessed at thebraffgroup.com
- Casper KL, Storti S, Walters V. Models of Integrated Patient Care Through OTPs and DATA 2000 Practices. Submitted by the American Association for the Treatment of Opioid Dependence in partial fulfillment of contract #HHSP233201400268P. February 22, 2016.
|New technology to address abuse and pain treatment
There’s no little irony in the fact that opioid abuse of prescription pills is creating a market for deterrents to that abuse, or treatments like naloxone to resuscitate overdosed opioid abusers. The situation is so fraught that the Abuse Deterrent Coalition (www.abusedeterrent.org), a group of pharma companies, drug delivery companies and drug abuse public-interest groups, has issued an “Abuse Deterrent Formulation: Myths and Facts” position paper that starts with the myth, “There is no evidence that abuse deterrent formulations have a real world impact.” (In fact, multiple studies have shown just such an impact; the problem is, as prescription opioids become less desirable among addicts, those addicts are turning to heroin and street-level fentanyl.) Without abuse deterrent formulations, patients suffering chronic pain would have little recourse to treatment.
Grünenthal, the Aachen, Germany company that developed multiple forms of extended-release opioids, is also the developer of Intac, its proprietary technology for tamper resistance, currently in use in multiple commercial opioid formulations. Other abuse-deterrence developers include Inspiron Delivery Services, Acura Pharmaceuticals and Intellipharmaceutics International.
Abuse deterrence is just one of multiple R&D efforts underway to combat opioid abuse. The commercialization of naloxone, a drug that counters the respiratory effects of opioid overdose, is now widespread; FDA is considering methods to enable the drug to be marketed as an OTC product, and multiple states have modified their prescription-dispensing rules to allow patients or their caregivers to obtain the drug.
Last year, FDA approved Probuphine, an implantable form of buprenorphine developed by Braeburn Pharmaceuticals and Titan Pharmaceuticals, using the latter’s ProNeura drug delivery platform. The drug is supposed to provide patients a steady, maintenance dosage for up to six months as part of a therapy program.
Research has been going on for decades to find pain-relieving drugs that lack opioids’ addictive properties, but the results have been thin so far. A recent trend is to combine an opioid substance with an antagonist (such as naltrexone), or with a bioactive neurotransmitter involved in pain perception in the brain. Most recently, Grünenthal, working with an Italian pharma company, Abiogen Pharma, was granted a Breakthrough Therapy Designation for neridronic acid, a potential treatment for a rare-disease condition known as complex regional pain syndrome.
A researcher at the Scripps Research Institute, Kim Janda, and others completed a 2012 study of a heroin vaccine, said to combat heroin’s addictive attributes while simultaneously not affecting opioid receptors in the brain (thus, presumably, enabling the pain-relief aspects of an opioid), but the research has not progressed beyond animal studies.