Drug Channels delivers timely analysis and provocative opinions from Adam J. Fein, Ph.D., the country's foremost expert on pharmaceutical economics and the drug distribution system. Drug Channels reaches an engaged, loyal and growing audience of more than 100,000 subscribers and followers. Learn more...
A new survey of plan sponsors sheds light on their satisfaction with transparency at large and small pharmacy benefit managers (PBMs).
As you will see, clients remain slightly more satisfied with the perceived transparency of smaller PBMs compared with the Big Three PBMs—CVS Caremark, Express Scripts, and Optum Rx.
However, plan sponsors are dissatisfied with transparency about how both large and small PBMs make money. Smaller PBMs have an edge, but it’s narrower than you might think.
Perhaps PBMs’ clients are unable or unwilling to negotiate better deals, write more effective contracts, and switch to more satisfying relationships. Or maybe they don’t mind the current system, despite the challenges for patients. Some argue that transparency could swoop down to solve this problem. Riddle me this: Should we watch what plan sponsors say, or what they do?
Today’s guest post comes from Angie Franks, Chief Executive Officer of Kalderos.
Angie discusses how the Maximum Fair Price provision of the Inflation Reduction Act of 2022 will challenge providers, pharmacies, and manufacturers. She explains how Kalderos’ Truzo platform could reduce duplicate claims and address compliance issues.
As regular readers of Drug Channels know, U.S. distribution and dispensing channels for prescription drugs are undergoing significant evolution and consolidation as the changing economics of pharmaceuticals challenge conventional business models.
During this period of volatility, the core business model of the Big Three public pharmaceutical distribution companies—Cardinal Health, Cencora, and McKesson—remains intact. Put simply: Buy low, sell high, collect early, and pay late.
But as I explain below, wholesalers continue to position themselves as essential intermediaries by expanding their industry position and strengthening their economic fundamentals.
Read on for five key pricing, pharmacy, provider, and manufacturer trends that are driving the U.S. drug wholesaling industry.
Experts from across the US come together each year at the PBM Contracting Summit to gain innovative and practical contracting strategies, master PBM innovation and design, improve patient care management and rising costs, understand the current legislative issues impacting contract negotiations and more. Join us in Chicago (or virtually) where you’ll benefit from two days of learning, education and networking, and will return to the office having mastered the complex PBM landscape.
You’ll hear from Matthew Gibbs, Pharm.D., Pharmacy Transformation Leader of Blue Shield of California as he leads a comprehensive discussion on the PBM landscape over the last year, and delves into the evolving trends and emerging challenges shaping the current industry today.
Other expert and thought leaders from within the industry are slated to present deep dive sessions, workshops and panels that will answer your most pressing questions:
What are the latest legislative updates and proposed federal bills impacting PBM operations?
What's on the horizon for alternative PBMs? What are the top intricacies of rebate eligibility? What are the market impacts of innovative models such as Mark Cuban's Cost Plus Drugs and Amazon's pharmacy model?
What can be learned from the J&J lawsuit? Review the expansion of data access and the importance of employer's fiduciary duties.
What are the challenges of vertical integration?
How do PBMs manage their contracting processes with plan sponsors to create successful contracts?
What are the most effective strategies for spread pricing and reimbursement models?
What is the best solution to navigate the challenges of the 340B drug pricing program and PBM contracting?
What is the best way to design and optimize benefits for covering GLP-1s?
How can I ensure compliance with ERISA requirements?
What are the latest developments in copay maximizer and accumulator programs?
What market dynamics and barriers are impacting pricing and demand?
What can be learned from the economic landscape of biosimilars and specialty therapeutics?
View the agenda for the PBM Contracting Summit to see the complete picture – the program, speakers, and more, visit www.informaconnect.com/pbm-contracting for further details and to register. Drug Channels readers will save 10% off when they use code 24DRCH10 and register prior to November 8, 2024.*
*Cannot be combined with other offers or used towards a current registration. Cannot be combined with special category rates or other offers. Other restrictions may apply.
The content of Sponsored Posts does not necessarily reflect the views of HMP Omnimedia, LLC, Drug Channels Institute, its parent company, or any of its employees. To find out how you can promote an event on Drug Channels, please contact Paula Fein(paula@DrugChannels.net).
Today’s guest post comes from Timothy Nielsen, Vice President of Customer Success at AssistRx.
Timothy discusses the affordability and patient journey challenges of specialty-lite products for patients, manufacturers, and health care providers. He explains how AssistRx's Advanced Access Anywhere (AAA) solution streamlines processes for specialty-lite products and facilitates enrollment via a digital hub.
Contrary to what you may have heard, the Inflation Reduction Act’s (IRA) inflation rebates for Medicare Part B drugs do not always save money for seniors.
As we document below, a growing share of Part B drugs have inflation-adjusted coinsurance rates that have been increasing, not declining. In many cases, the coinsurance rate declines only briefly before rebounding back to the standard 20% rate. What’s more, these fluctuations have triggered huge jumps in patients’ out-of-pocket obligations for some drugs—even when a drug’s costs were falling.
Chalk off these coinsurance surprises to yet another unintended consequence of the IRA. Seniors who are expecting to see costs drop may find they are instead being taken for a rollercoaster ride.
The 340B contract pharmacy market shows little sign of slowing down. Drug Channels Institute’s exclusive analysis of the 2024 market reveals that:
About 33,000 pharmacy locations—more than half of the entire U.S. pharmacy industry—act as contract pharmacies for the hospitals and federal grantees that participate in the 340B program.
Five multi-billion-dollar, for-profit, publicly traded pharmacy chains and pharmacy benefit managers (PBMs)—Cigna (via Express Scripts), CVS Health, UnitedHealth Group (via OptumRx), and Walgreens, Walmart—continue to dominate the 340B contract pharmacy market.
Federal grantees are aligned primarily with the vertically intergated organizations' retail pharmacies, while hospitals rely on mail and specialty pharmacies.
Over the past four years, manufacturers’ restrictions on 340B contract pharmacies have led hospitals to deepen their relationships with the largest PBMs—even as those PBMs have simultaneously limited hospitals’ direct participation in specialty pharmacy networks.
Last week, the Federal Trade Commission (FTC) released the redacted version of administrative complaint against the three largest pharmacy benefit managers (PBMs). The FTC rightly calls out how the gross-to-net bubble can raise patients’ out-of-pocket costs, while also acknowledging how rebates can reduce a plan's (but not the patient’s) costs. Apparently, the FTC believes that PBMs’ customers are pretty dumb, because PBMs are able to prevent plans from “appreciating” such healthcare financing dynamics.
Section V.E. of the complaint (starting on page 23) focuses on the PBMs’ alleged unlawful conduct related to preferring high-list/high-rebate insulin products over versions with lower list prices. I thought it would therefore be fun to take the Wayback Machine to November 2021, when I wrote about this specific topic.
Below, you can review my commentary about the warped incentives behind Viatris’ dual-pricing strategy for its interchangeable biosimilar of Lantus. Much of the FTC’s description of the drug channel aligns with my commentary. But before you fist pump too hard for Ms. Khan’s FTC, you should pause to reflect on the agency’s legal theories in light of plans’ revealed preferences.
The Food & Drug Administration (FDA) recently approved the first interchangeable biosimilar insulin product: the insulin glargine-yfgn injection from Viatris. Read the FDA’s press release.
Alas, I’m sad to report that the warped incentives baked into the U.S. drug channel will limit the impact of this impressive breakthrough.
Viatris is being forced to launch both a high-priced and a low-priced version of the biosimilar. However, only the high-list/high-rebate, branded version will be available on Express Scripts’ largest commercial formulary. Express Scripts will block both the branded reference product and the lower-priced, unbranded—but also interchangeable—version. Meanwhile, Prime Therapeutics will place both versions on its formularies, leaving the choice up to its plan sponsor clients.
Consequently, many commercial payers will adopt the more expensive product instead of the identical—but cheaper—version. As usual, patients will be the ultimate victims of our current drug pricing system.
Below, I explain the weird economics behind this decision, highlight the negative impact on patients, and speculate on what this all could mean for biosimilars’ future. Until plan sponsors break their addiction to rebates, today’s U.S. drug channel problems will remain.
The access and affordability landscape is undergoing a seismic shift. Evolving legislation, disruptive market forces and the ever-growing complexities of cost sharing programs threaten patient adherence and commercialization strategies. Are you ready?
A program driven by marketplace insights and led by industry trailblazers, Copay, Reimbursement and Access Congress is back November 18-20 and will deliver up-to-date insights necessary to enhance patient affordability, ensure program sustainability and navigate the regulatory landscape. In a time where remaining compliant has never been more complex and program innovation has never been more important, be sure to join your industry counterparts to drive adherence, access and commercialization forward.
Why attend the Copay, Reimbursement and Access Congress?
Keeping up with shifting market dynamics in the midst of maximizing access, while also meeting business objectives is a challenging task and brings about many questions for access professionals.
Is your program sustainable and innovative to better support patients?
Accumulators, maximizers, AFPs – What are your next steps to ensure effective reimbursement strategies?
In an election year, what is the future of health policy?
Experts will tackle these questions and more as the industry comes together to benchmark best practices to accelerate access and commercialization. Do not miss your chance to join seasoned leaders, your peers and leading solution providers as they navigate marketplace trends and dive into the impact coupons, benefit design, accumulators, maximizers, alternative funding programs and drug pricing legislation have on patient affordability and out-of-pocket costs. This is your chance to gain critical insights on industry standards, forward-thinking strategies to optimize your copay and cost sharing programs and so much more.
Content highlights:
Over 20 hours of content, including 7+ dedicated sessions to help decipher copay legislation
Crucial perspectives from Pfizer, Sanofi, Janssen, Teva, Ascendis Pharma, Melinta Therapeutics, GSK, HIV + Hepatitis Policy Institute and more
Insights direct from enforcement agents on the top trends and actions within the copay and patient services space
Illuminating case study, Navigating the Patient Journey in a Shifting Copay Landscape from Spark Therapeutics
465 minutes of valuable in-person networking with colleagues and counterparts to expand your network and establish powerful partnerships
Additional content access through Streamly, a platform that gives you 12-month access to all of the available conference content** to review at your leisure
And more!
Download the agenda and register today—Be sure to use your exclusive promo USAVE24 to save 10% off* of your registration
See you there!
*Cannot be combined with other offers, promotions or applied to an existing registration. Other restrictions may apply.
**Pending speaker permissions
The content of Sponsored Posts does not necessarily reflect the views of HMP Omnimedia, LLC, Drug Channels Institute, its parent company, or any of its employees. To find out how you can promote an event on Drug Channels, please contact Paula Fein(paula@DrugChannels.net).
Today’s guest post comes from George Moore, Chief Information Technology Officer at CareMetx.
As George explains using novel survey data, manufacturers view new technologies as crucial for patient services. He then explains how digital technology, artificial intelligence (AI), and machine learning (ML) can be used to improve patient adherence and increase hub efficiencies.
During these events, Dr. Fein will address the latest issues confronting the U.S. drug channel. Topics will be determined based on what’s happening—trends, policy changes, company announcements, and more. He’ll share DCI’s latest market data to help you stay on top of new developments. You will be able to use these events as both a capstone of your current learning and a touchpoint for the future.
The three events are scheduled for 12:00 p.m. to 1:30 p.m. ET on the following dates:
April 4, 2025
June 20, 2025
December 12, 2025 (Drug Channels Outlook 2026)
For 2025, we are offering a Corporate Pricing option that will allow larger organizations to register hundreds of colleagues for one fixed price. Please contact Paula Fein (paula@drugchannels.net) for details.
Read on for full details on pricing, including substantial discounts for multiple sites.
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This week, I’m rerunning some popular posts while we put the finishing touches on DCI’s new 
This week, I’m rerunning some popular posts while we put the finishing touches on DCI’s new 
