President Donald Trump gave a speech about pharmaceutical drug prices last month. During his presidential campaign and leading up to his inauguration, he accused pharmaceutical companies with “getting away with murder” for what they charge patients for prescriptions and promised to enact reforms to lower drug prices. After sixteen months in office, his speech last month consisted of few proposals as opposed to proposing meaningful legislation or guidelines that could have an immediate effect on prescription costs and actually led to pharmaceutical stocks rising.   Trump took aim at Pharmacy Benefit Managers (PBMs) who he referred to as “middlemen” who implement “gag rules” that forbid pharmacists from telling patients they are spending more than they need to on a prescription (you can read our blog on the laws proposed

to combat PBM gag rules here). He also touched on other popular proposals such as removing barriers to generic medications and biosimilars from entering the market and encouraging lower prices through competition, as well as granting Medicare Part D more flexibility to negotiate prices with manufacturers.   Some new ideas did emerge from Trump’s speech: price transparency by encouraging pharmaceutical companies to include the list price of their drug in advertisements; and to somehow make foreign nations (many of which buy U.S.-made medications through direct negotiations between their governments and pharmaceutical companies) pay more. There is little evidence to support transparency in pricing will impact prescription prices; it follows a pattern of attempting to “shame” pharmaceutical companies, as the Food and…

In a previous blog post, we explored “clawback” and how it affects the prices of prescriptions. In short, Pharmacy Benefit Managers (PBMs) negotiate copay prices for insurers that are often higher than the cash price paid by uninsured patients all while instituting a “gag rule” for pharmacists to forbid them from revealing the price discrepancy to patients unless asked directly. A number of states have already passed laws banning clawback and gag rules, though a group of bipartisan U.S. senators have introduced a bill the ban gag clauses for PBM-negotiated contracts nationwide. A recent study by Journal of the American Medical Association (JAMA) found that 23% of all prescriptions filled through insurance ended up costing more than patients who would pay out-of-pocket. Related to this, a

national poll from West Health Institute/NORC at the University of Chicago found 32% of Americans didn’t buy a prescription or took less than the prescribed dosage due to cost. This all appears to be exacerbated by the continuing rise of prescription costs; in the past 14 months well known/high-use prescriptions rose an average of 20%, while less common prescriptions rose between 100% to 1,468%. Pharmacists reportedly feel complicit in price gouging, and are often not allowed to offer information that could save patients money. However, if a customer specifically asks for a lower price option they are allowed to provide it. With this in mind, it is always a good idea to ask your pharmacist, “Is that the best price for my medication?” to…

Americans may be surprised to learn that they could be paying more for their medications with their insurance copay instead of the cash price available to those without insurance. A study published last week found that Pharmacy Benefit Managers (PBMs) undermine claims that negotiated “rebates” with pharmaceutical companies are passed on to consumers. This follows a federal lawsuit filed over the summer after a California woman paid a $164 copay on a medication that can be purchased for $92 from the same pharmacy by anyone not using insurance. This practice is known as “clawback” and is instituted by PBMs who then receive the excess payments from the pharmacy.   Pharmacy Benefit Managers are being found to frequently charge a copay that exceeds a medication’s cash

price for generic drugs. Moreover, pharmacists around the country are not allowed to disclose the price discrepancy to patients due to “gag clauses” in their contracts that forbid them from discussing the clawback practices with consumers or offering lower-cost options for those unknowingly opting for a higher price. The National Community of Pharmacists Association, representing 22,000 independent pharmacies, say the trend can be tracked to high-deductible health plans where more of the burden of cost is shifted to the consumer. One Texas pharmacist says his patients have lost more than $7,000 in 2017 that are collected from patients and given to PBMs as profit. Texas became one of eleven states that outlaw clawbacks or gag clauses in September.   Pharmacists reportedly feel complicit in price…