Reduce Drug Prices by Cutting Out PBM Rebates

The pharmacy benefit management lobbying organization and Express Scripts are running ads claiming that PBMs are reducing drug prices for consumers.

Express Scripts Fights Back Against Irresponsible Drug Pricing

“At Express Scripts, we put medicine within reach – making it more accessible and affordable for the employers and patients we serve. It’s why we exist.

In a year where the high cost of prescription medications dominated headlines, Express Scripts delivered value beyond and practiced pharmacy smarter, protecting employers and patients by driving down costs and improving outcomes.

Our country needs affordable medicines, and Express Scripts is best positioned to deliver them. The proof is in the data.”

That’s false advertising.  Express Scripts didn’t put medicines in reach.  Rather it manipulated prices and access to maximize rebates and out of pocket consumer costs.

It’s an incredibly rigged system.   Nearly $130 billion of drug spending goes to PBMs and insurers in the form of rebates.  And the spread between what PBMs get and what they pay for drug prices continues to soar:

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2017-02-08 | Robert Goldberg

A Lobbying Group Is Freaking Out Over What Trump May Do To Drug Prices

“The sense that this President could make any decision, at any time, for any reason, on any issue is rattling industries in the health care sector and beyond,” an internal memo from the CEO of the Pharmaceutical Care Management Association says.

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posted on Feb. 7, 2017, at 1:54 p.m.

Zurik: Insurers pushing Medicare clients into the donut hole

Why do most donuts have holes?  “So they fry evenly, throughout the entire donut,” Stephanie tells us. “You’re not stuck with a doughy donut.”

To many, that hole makes the perfect donut. But when it comes to Medicare, a donut hole can become quite sour for patients.

“They should call it, just, the hole, or the pit,” says Doug Hoey, who heads the National Community Pharmacists Association.

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Express Scripts: Rebate System is a Financial Engineering Kickback Scheme

One company in the healthcare system that deserves to fall to the mighty sword of the new Trump administration is Express Scripts.  (NASDAQ:ESRX) has used their position as the nation’s largest PBM to make itself into  Read more…

January 27, 2017 By

Marathon Pharmaceuticals to Charge $89,000 for Muscular Dystrophy Drug After 70-Fold Increase

A drug to treat muscular dystrophy will hit the U.S. market with a price tag of $89,000 a year despite being available for decades in Europe at a fraction of that cost.

Marathon Pharmaceuticals LLC’s pricing of the drug, which has been available in Europe, is the latest example of a business model that has drawn ire from doctors, patients and legislators in recent years: cheaply acquiring older drugs and then drastically raising their prices.  Read more…

The EpiPen Price Increase: A Deeper Look at a Complicated Story

Over the past couple of months, EpiPen’s (epinephrine) manufacturer Mylan has been under increasing scrutiny for skyrocketing the list price to over $600 for a two pack of the drug, an increase of more than 500% since 2007. The result: public outcry, multiple Senate committee meetings, and a scramble to salvage their reputation.[i]

 

What have we learned from the price increase controversy centered on Mylan’s EpiPen auto injector? What are the potential impacts or consequences for drug manufacturers, pharmacy benefit managers, health plans, and consumers? Who pays when drug prices increase, such as in this EpiPen scenario?

Examining the pharmacy supply chain can shed some light into the flow of monies. In some instances, when a retail pharmacy dispenses an EpiPen prescription for an insured patient, they have no idea how much the insurance company is paying for the drug. Moreover, the insurance company in many cases is not clear how much the pharmacy is getting reimbursed for the drug. Finally, Mylan does not receive the published list price.

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by AJ Ally at Argus-health.com

UnitedHealth sued over prescription drug co-pay costs

UnitedHealth Group has been sued by three customers who accused the largest U.S. health insurer of charging co-payments for prescription drugs that were higher than their actual cost and pocketing the difference.  The lawsuit, filed Tuesday in federal court in Minnesota by three UnitedHealth customers, seeks to represent a nationwide class that it says could include “tens of thousands” of people insured by UnitedHealth.

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With new calls for congressional hearings, PBMs could be next on Capitol Hill’s hot seat

Congress may be busy investigating Mylan and its EpiPen pricing, but that doesn’t mean its watchdog committees can’t turn a spotlight on pharmacy benefits managers, too.

After Mylan CEO Heather Bresch blamed PBMs for “incentivizing” price increases, pharmacists–including Rep. Buddy Carter, the only pharmacist in Congress–are calling for more scrutiny.

The National Community Pharmacists Association urged the House Committee on Oversight and Government Reform to investigate PBMs, which manage formularies and negotiate drug discounts for insurers. Mylan has said that PBM rebates account for almost half of EpiPen’s $600-plus list price.

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By Tracy Staton in Fierce Pharma

Horizon settles Express Scripts rebates lawsuit

Horizon Pharma has settled a lawsuit with prescription benefits manager Express Scripts related to disputed drug rebates.

Horizon Pharma USA, a Lake Forest, Ill.-based subsidiary of the Irish drugmaker, will pay $65 million to settle a lawsuit over $166.2 million in rebate payments that St. Louis-based Express Scripts said it was owed from Horizon, according to regulatory filings. The settlement comes after Horizon countersued Express Scripts, contesting the amount owed and alleging a breach of contract by the PBM.

The suit relates to rebates for Duexis, Rayos and Vimovo, which are some of Horizon’s most popular drugs and are used in rheumatoid arthritis and osteoporosis, among other diseases. Neither party will admit any fault or wrongdoing in the settlement.

 

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By Adam Rubenfire at ModernHealthcare.com

The Diabetes Price War Claims Casualties

Through no fault of their own, 1,000 people just became victims of a drug-price war mostly taking place on another continent.

Danish pharma giant Novo Nordisk announced Thursday it is cutting 1,000 jobs (about half of them in Denmark), after last month slashing growth forecasts for 2016, citing lower U.S. prices for diabetes drugs. These will likely not be the last victims, either — Novo and competitors such as Sanofi and Eli Lilly will likely have to keep tightening their belts as prices and profit margins fall.

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By Max Nisen at Bloomberg.com