Parts of this research were sponsored by and conducted in collaboration with Cephalon, Inc. ORGANIZATION: MedImpact is a Pharmacy Benefit Management (PBM) company serving more than 32 million members nationwide. PROBLEM OR ISSUE ADDRESSED: There is a need in the managed care setting to rigorously compare pharmaceuticals with similar therapeutic indications for formulary coverage decisions based on clinical advantages, utilization, and budgetary differences. Modafinil and armodafinil are indicated to improve wakefulness in patients with treated obstructive sleep apnea, shift work disorder and narcolepsy. While both medications are approved for once-daily dosing with different multiple tablet strengths, there are utilization differences between the products. Addressing these utilization differences surrounding the commercial availability of a new therapy with less than six months of claims data becomes even more challenging. GOALS: (1) To examine the real-world utilization of armodafinil and modafinil based on DACON. (2) To apply economic modeling techniques in the DACON analysis to determine the pharmacy budget impact of armodafinil and modafinil. OUTCOMES ITEMS USED IN THE DECISION: The primary measure used in the analysis was DACON from pharmacy claims data applied to economic modeling.  The analysis was not specific to dosage regimen or indication. IMPLEMENTATION STRATEGY: The DACON of armodafinil and modafinil were examined in a large retrospective database analysis of Wolters Kluwer Source LX pharmacy analytic file between March 2009 and October 2009.  The study dates were chosen to provide 5 full months of armodafinil claims data after commercial availability (June 1, 2009) and 3 months of data prior to account for patients who switched from modafinil to armodafinil. DACON was calculated by dividing the total tablets dispensed by the total days supplied. MedImpact subsequently conducted a DACON analysis using its pharmacy claims data from 3rd quarter of 2009.  The MedImpact DACON values for armodafinil and modafinil were examined and incorporated into economic modeling of the pharmacy budget impact. The cost per day of therapy was calculated as the weighted average cost per tablet (based on wholesale acquisition cost as of January 2010), exclusive of any discounts or rebates multiplied by the MedImpact DACON. RESULTS: DACON results for armodafinil was 1.03 based on 21,085 armodafinil prescriptions and the DACON for modafinil was 1.40 based on 278,985 modafinil prescriptions in the Wolters Kluwer Source LX data.  In the MedImpact analysis, DACON values for armodafinil was 1.05 and the DACON for modafinil was 1.47.  The DACON for armodafinil and modafinil was applied to an economic model using a simulated 1,000,000 member life plan of which 0.5% of the lives were treated with modafinil. In the period prior to commercial availability of armodafinil, the utilization was 100% modafinil. Based on economic modeling using the MedImpact DACON and difference in the daily cost of both therapies, based on 7% actual utilization of armodafinil, the projected cost savings was $469,755.  On a per-member per month (PMPM) basis this simulated population experienced a cost savings of $0.039 PMPM. A 25% utilization of armodafinil would provide a projected cost savings of $1,677,696 and a PMPM savings of $0.140 PMPM.  LESSONS LEARNED: In this simulated population, the data suggests that armodafinil with a lower DACON and cost per tablet compared to modafinil would save $469,755 over 1 year in this therapeutic class. MedImpact consistently examines the utilization of pharmaceuticals with similar indications by analyzing DACON and other metrics using retrospective claims analysis in tandem with budget impact models. DACON provides real-world utilization that can have a significant impact on pharmacy budgets. Private payers should leverage their access to claims data that can help to more accurately measure pharmaceutical utilization. By using pharmaceutical claims data in tandem with well-designed economic models, payers can better estimate current and future spending.