Pharm Exec is no fortune teller, but our guest author Mason Tenaglia was positively clairvoyant in his January feature on the tussle between pharmacy benefit managers [PBMs] and brand name drug manufacturers over the use of co-pay and discount cards to limit out-of-pocket costs for patients.
Suing for the Drug Company Suet
Pharm Exec is no fortune teller, but our guest author Mason Tenaglia was positively clairvoyant in his January feature on the tussle between pharmacy benefit managers [PBMs] and brand name drug manufacturers over the use of co-pay and discount cards to limit out-of-pocket costs for patients. As predicted, the issue has caught fire, moving from rhetoric to preemptive action and now to litigation. It is fast becoming the topic du jour for the US industry, overshadowing Obamacare in terms of its potential to disrupt the once staid relationship between manufacturers, service providers and payers.
The conflict is a simple one: drug manufacturers, anxious to limit damage from the patent cliff, are aggressively using cards and other discount incentives to persuade patients to stay with the familiar brand and avoid pressure to move to cheaper generic alternatives. PBMs tend to see the incentives as less of an option for the patient than as a challenge to their flexibility in adjusting drug formularies to control costs and keep plan administrators happy. Both parties recognize the significant competitive stakes, with manufacturers better able to slow the erosion of market share from loss of exclusivity – Pfizer’s discount co-pay offer card for Lipitor patients being the latest and most prominent example – while PBMs that fail to respond face a more confusing picture around customer engagement and the drug budgeting cycle. While it is clearly an exaggeration, no PBM is comfortable tackling the pregnant question posed by the proliferation of unilateral manufacturer discounts: who’s really in charge of your drug formulary?
The latest escalations in the game took place last week. The first was a preemptive strike by Blue Cross Blue Shield of Rhode Island asking participating pharmacists to limit the acceptance of discount cards on certain high volume brand name prescriptions for patients enrolled in its plans.
The second was a lawsuit filed by a coalition of consumer and labor groups against eight drug companies [Abbott, Amgen, AZ, BMS, GSK, Merck, Novartis, and Pfizer] accusing them of offering what the group says are essentially “kickbacks” to patients, with the aim of preventing health plans and patients from saving money through transitioning to cheaper generic drugs once patents expire. The lawsuit relies heavily on estimates from a report prepared late last year by the PBM trade group, Pharmaceutical Care Management Association [PCMA], that use of discount cards by brand name manufacturers will raise formulary costs for providers by $32 billion over the next 10 years.
Analysts say making this case on legal grounds will be a hard sell, and it is worth noting that none of the big PBMs have joined in. Nevertheless, the lawsuit could cast more light around the murky - and increasingly ruthless - ways that drug makers are vying to preserve market share in a post patent expiry world. Lawyers being lawyers, it may also help stretch the already porous boundaries of what the federal compliance bureaucracy defines as anti-competitive behavior. As precedents in other countries will show, isn’t competition law just the latest innovation in cost control?
The Transformative Role of Medical Information in Customer Engagement
October 3rd 2024Stacey Fung, Head of Global Medical Information at Gilead Lifesciences, delves into the evolving role of Medical Information (MI) in the pharmaceutical industry. Covering key topics like patient engagement through omnichannel strategies, combating misinformation, and leveraging AI to enhance medical inquiries, the conversation with Stacey highlights MI's critical role in ensuring patient safety and supporting drug development. She also shares her professional journey and tidbits for early career professionals on professional development.
Unlocking value and cost savings in patient services with technology and talent
October 2nd 2024Traci Miller, Director, Sonexus™ Access and Patient Support, Cardinal Health, discusses the current digital trends in the patient services industry and how the optimal balance of technology and talent can transform manufacturer-sponsored patient support programs. Hear how Cardinal Health combines best-in-class program and pharmacy operations with smart digital tools to ensure product and patient success and reduce operational costs.