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Patients Lose Access to Free Medicines Amid Spat Between Drugmakers, Health Plans

Pharmaceutical companies have cut financial assistance to thwart health-plan tactics


It is getting tougher for people taking expensive medicines to get financial help from drugmakers.


Johnson & Johnson, Pfizer and other pharmaceutical companies are scaling back programs that cover the copayments of patients or provide free drugs. The programs have been costing drugmakers billions of dollars a year and have been increasing as health plans seeking to control their own spending have tried to take advantage of the assistance.


The assistance provided a lifeline to patients like Evan Pilker, who said he had to stop taking his cystic-fibrosis drug Trikafta for two months earlier this year after Vertex Pharmaceuticals trimmed its aid and his copay increased to $12,860 a month, up from $15.

Mr. Pilker, a 32-year-old truck driver with two young children, couldn’t afford the increase. After a month without the medicine, he had trouble breathing, along with coughing fits and fatigue, he said. Mr. Pilker resumed taking the drug in late February because an independent charity agreed to temporarily help with the expense.

“I didn’t want to die at an early age from CF and leave a wife and kids behind,” said Mr. Pilker, who lives in Patton, Pa. “I was scared.”

Vertex has agreed to give Mr. Pilker the medicine for free and now ships it directly to him. A company spokeswoman said, “Changes to our copay assistance program were made in response to predatory insurance practices.”

A spokesman for the trade group America’s Health Insurance Plans said pharmaceutical companies were trying to sidestep cost-control efforts by encouraging patients to take expensive drugs through copay assistance. “The problem isn’t health insurance providers, it’s the price of prescription drugs,” the spokesman said.

Mr. Pilker and other patients are getting caught in the middle of the latest flare-up between pharmaceutical companies and health insurers over high drug prices.

“For our clients, this has cut the potential of saving money through assistance in half if not more,” said Alan Greensmith, managing director of Engedi Rx, which advises employers on how to save on drug costs.

Health insurers and employers who pay for healthcare have long tried to make patients pay a portion of the price of expensive medicines, in part to encourage patients to take cheaper, equally effective treatments.

The efforts often take the form of copays, which patients have to pay each month before they can fill a prescription. Growing numbers of people with insurance must also pay a sum, called a deductible, at the start of each year before their health plan will start reimbursing for drugs. To counter the health plans, drugmakers created financial-assistance programs that cover all or most of patients’ out-of-pocket costs. The programs, by taking care of the out-of-pocket expenses, cleared the way for health plans to pay for the rest of a drug’s cost.

Some health plans, seeking to restrain rising spending on higher-priced drugs, in turn took steps to counter the pharmaceutical assistance programs. For example, they stopped counting drugmakers’ assistance toward deductibles, or they required a member to seek the maximum amount of aid available before an insurer would pay the rest of the drug’s cost.

Plans also designed benefits to steer some members to pharmaceutical company foundations that give away free drugs to people meeting certain income requirements, and who don’t have insurance or whose health plan doesn’t cover specific drugs.

Companies sprouted up to advise employers on how to save money by taking advantage of the pharmaceutical assistance programs. These middlemen, which market themselves as advocates or chaperones to “alternate funding programs,” are paid by employers, often based on a percentage of the savings they provide.

The cost of the pharmaceutical companies’ financial-assistance programs ballooned. Drugmakers spent $18.7 billion on copay assistance in 2022, up 29% from $14.5 billion in 2018, according to Iqvia Holdings, a data and services provider to the pharmaceutical industry.

“Unfortunately, some companies are monetizing the diversion of patient assistance funds, challenging the sustainability of some assistance programs,” a J&J spokesman said. “As a result, we have created safeguards to protect our program and the patients it serves.”

On Jan. 1, a nonprofit established by J&J to provide free medicines began excluding all patients who have health insurance. The company, which sells the psoriasis drug Stelara and blood thinner Xarelto, created a new, in-house program to provide free medicine to some insured patients, but not those whose plans require them to seek free medicine.

J&J’s patient-assistance foundation provided $2.5 billion worth of free medicine to more than 95,000 patients in 2020, more than double the $1.1 billion the foundation provided in 2017, according to Internal Revenue Service filings.

Likewise, Pfizer on Jan. 1 began excluding new patients with commercial insurance from its free-medicine program. The company also dropped certain off-patent drugs from its free-medicine program because alternatives or generics are available, a move that affected about 24% of patients who had been enrolled at the end of 2022, a Pfizer spokeswoman said. ‘I didn’t want to die at an early age from CF and leave a wife and kids behind,’ Evan Pilker said.

The changes will allow Pfizer to keep providing a range of medicines free of cost to the neediest patients, the company spokeswoman said.

A free-medicine foundation established by Bristol-Myers Squibb said in a March letter to doctors that patients won’t be eligible starting April 3 if their insurance plans require them to seek free medicine from manufacturers, or if the plans change or hide their insurance coverage to make the patient appear to be underinsured.

A foundation spokeswoman said it tightened eligibility to ensure “that this attempted exploitation of our program does not jeopardize the resources intended for qualifying patients.”

Two of the middlemen firms, Paydhealth and Payer Matrix, said they assist patients with finding all of the charitable assistance available to them under the guidelines and rules established by pharmaceutical companies and their foundations.

Middlemen companies said they are responding to a need among employers and other funders of health benefits to keep down rising specialty drug costs, which in diseases like cancer can exceed $100,000 annually per patient.


Reporters: Write to Peter Loftus at Peter.Loftus@wsj.com and Joseph Walker at joseph.walker@wsj.com


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