“DOSE OF REALITY” Calling Big Pharma’s Bluff On PBMs: Part II

Big Pharma has tried to evade culpability for the crisis of rising prescription drug prices by pointing a finger at pharmacy benefit managers (PBMs).  As the U.S. Senate Committee on Finance prepares to hear from the executives of five PBMs on April 9, it’s time to debunk Big Pharma’s bluffs.  PBMs serve an essential role in the prescription drug distribution chain and work on behalf of payers and consumers to reduce prescription drug costs, increase convenience and improve safety.

Ahead of the hearing, we’re setting the record straight on the essential role PBMs play in negotiating savings for patients by calling out Big Pharma’s suspect claims and pushing back on the proposed Rebate Rule’s false promises.

Yesterday, we took down Big Pharma’s claims that PBMs are unnecessary middlemen.

Today, we’re challenging the falsehood that eliminating rebates will bring down the cost of prescription drugs.

MYTH:

Eliminating Rebates Will Automatically Lower Drug Prices.   

FACT:

Rebates Are Rarely Offered For Many High-Priced Drugs That Lack Competition.

• Most Drugs Do Not Receive Rebates, Including 89 Percent Of Medicare Part D Prescriptions. (Nicholas J. Johnson, Charles M. Mills & Matthew Kridgen, “Prescription Drug Rebates And Part D Drug Costs,” Milliman, 7/16/18)

• 87 Percent Of Medicare Part D Prescriptions Are For Generic Drugs That Receive No Rebates. (Nicholas J. Johnson, Charles M. Mills & Matthew Kridgen, “Prescription Drug Rebates And Part D Drug Costs,” Milliman, 7/16/18) 

• Of The 13 Percent Of Medicare Part D Prescriptions For Brand-Name Drugs Only 11 Percent Have Rebates. (Nicholas J. Johnson, Charles M. Mills & Matthew Kridgen, “Prescription Drug Rebates And Part D Drug Costs,” Milliman, 7/16/18) 

• Few Rebates Are Offered For New Drugs Which Can “Cost Hundreds Of Thousands Of Dollars A Year” Because They Lack Competition. (Katie Thomas, “Meet The Rebate, The New Villain Of High Drug Prices,” The New York Times, 7/27/18)

According To Government Actuaries’ Estimates, Under The Rebate Rule The Cost Of Drugs Could Increase Before Finally Leveling Out, But They Do Not Predict Costs Lowering At All.  

• Under The Actuaries Assumptions, The Weighted-Average Effect Net Price Of A Drug Would Increase. (Center For Medicare & Medicaid Services Office Of The Actuary, Memo On Proposed Safe Harbor Regulation, 1/31/19)

Click through to catch up on Calling Big Pharma’s Bluff On PBMs: Part I HERE.