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Diplomat Managing Rising Drug Costs to Support Patients

FLINT, Mich. — Feb. 21, 2018 — The nation’s largest independent provider of specialty pharmacy services outlines initiatives to control rising drug costs.

Diplomat Pharmacy, Inc. (NYSE: DPLO) plans to combat rising healthcare costs throughout 2018 by advancing generic drugs, biosimilars, and affordable brand medications.

Joel Saban, president of Diplomat, said the growing market for high-cost specialty drugs in the U.S. drives up costs for health plans and patients.

“With 90 percent of traditional medications now filled as generics, specialty pharmacy costs are driving pharmacy spend for payers,” Saban said. “To offer real solutions to today’s challenges, we need a new model with a diverse set of assets. The need for specialty benefit management solutions has never been more urgent.”

Saban noted an enhanced split-fill program as an example of Diplomat’s cost-saving measures. In early 2018, the company increased the number of drugs included in the program by 78 percent.

“This program can save up to 50 percent per patient,” Saban said. “We give patients a two-week supply at the start of a new therapy. This allows us to mitigate waste in the event a patient needs to change therapies early on. In avoiding medication waste, we reduce spend for both the payer and patient.”

Diplomat also saves health plans money, Saban said, by providing alternative generic medications. He said approximately $2,400 is saved per month for each patient moved to generic oral oncolytic medication and $1,800 for each patient moved to generic multiple sclerosis medication.

Jeff Park, interim CEO of Diplomat, said the company is also watching the biosimilar market closely for opportunities to help drive prices lower.

“We view biosimilars as a key lever in managing the rising cost of specialty spend,” Park said. “Biosimilars have struggled to gain footing in the U.S. due to litigation. However, we expect the environment to become more favorable soon. This should lead to expanded biosimilar use and more affordable care.”

Diplomat recently published a report on the specialty drug pipeline and Food and Drug Administration (FDA) approvals. According to the report, the FDA’s Center for Drug Evaluation and Research approved 46 novel new drugs in 2017—the most since 1996 and more than double the 2016 total.

“The robust specialty drug pipeline—with new drugs and expanded indications for previously approved treatments—continues to drive industry growth,” Saban said. “One of Diplomat’s core strengths is staying ahead of the specialty pipeline curve. We start building relationships with innovative new companies years before product launch. This is important in continuing to increase our access to limited-distribution drugs.”

Saban said Diplomat remains dedicated to improving patient experiences and outcomes across the continuum of care.

“We want to make sure patients receive the most effective treatment at a price they can afford,” Saban said. “Reviewing new generics and biosimilar products—incorporating cost-saving strategies as appropriate—these steps bring Diplomat closer to meeting these urgent needs.”

To learn more about Diplomat, visit diplomat.is.

Forward-Looking Statements

This press release contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements give current expectations or forecasts of future events or our future financial or operating performance and may include Diplomat’s expectations regarding benefits of business and growth strategies. The forward-looking statements contained in this press release are based on management’s good-faith belief and reasonable judgment based on current information. These statements are qualified by important risks and uncertainties, many of which are beyond our control, that could cause our actual results to differ materially from those forecasted or indicated by such forward-looking statements. These risks and uncertainties include: our ability to adapt to changes or trends within the specialty pharmacy industry; our relationships with key pharmaceutical manufacturers; our ability to expand the number of specialty drugs we dispense and related services; and the additional factors set forth in “Risk Factors” in Diplomat’s Annual Report on Form 10-K for the year ended Dec. 31, 2016, and in subsequent reports filed with or furnished to the Securities and Exchange Commission. Except as may be required by any applicable laws, Diplomat assumes no obligation to publicly update such forward-looking statements, which are made as of the date hereof or the earlier date specified herein, whether as a result of new information, future developments or otherwise.

About Diplomat

Diplomat (NYSE: DPLO) is the nation’s largest independent provider of specialty pharmacy services—helping patients and providers in all 50 states. The company offers medication management programs for people with complex chronic diseases and delivers unique solutions for manufacturers, hospitals, payers, providers, and more. Diplomat opened its doors in 1975 as a neighborhood pharmacy with one essential tenet: “Take good care of patients and the rest falls into place.” Today, that tradition continues—always focused on improving patient care and clinical adherence. For more information, visit diplomat.is.


Diplomat Managing Rising Drug Costs to Support Patients

Kelly Pokuta

Senior Vice President, Industry Relations

810.768.9282 | kmcgrailpokuta@diplomat.is

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