“In January 2024, the pharmaceutical company Eli Lilly launched LillyDirect, a service that includes a direct-to-consumer pharmacy and a referral network of in-person and telehealth clinicians. These tools are intended to add new options for patients to access the company’s drugs, including its newly approved antiobesity drug tirzepatide (Zepbound). [..] LillyDirect is similar to several pharmacies that cut out insurers and PBMs [pharmacy benefit managers] and allow patients to purchase drugs at discounted cash prices. These include pharmacies introduced by major retail companies like Walmart, Costco, and Amazon, and independent pharmacies like the one named for its billionaire cofounder Mark … Read More
All posts in Drug Pricing
Excerpt – The three biggest PBMs [pharmacy benefit managers] — OptumRx, CVS Caremark, and Express Scripts — control about 80% of prescription drug sales in America and are the most profitable parts of the health conglomerates in which they’re nestled. CVS Health, the fourth-largest U.S. corporation by revenue on Fortune’s list, owns CVS Caremark and the insurer Aetna; UnitedHealth Group, a close fifth, owns Optum; and Cigna, ranking 12th, owns Express Scripts. While serving as middlemen among drugmakers, insurers, and pharmacies, the three corporations also own the highest-grossing specialty drug and mail-order pharmacies. [..] Drug manufacturers claim that exorbitant PBM demands … Read More
Excerpt – In this issue of JAMA Cardiology, Cohen and colleagues have performed a formal cost-effectiveness analysis of SGLT2 [sodium-glucose cotransporter-2] inhibitors for patients with heart failure and an ejection fraction more than 40%. They developed a computer-simulation model to project the long-term clinical benefits and costs for patients with HFpEF [heart failure with preserved ejection fraction] with and without SGLT2 inhibition. Their model was based on pooled estimates of baseline risk and effectiveness of SGLT2 inhibitors derived from the EMPEROR-PRESERVED and DELIVER trials. Because these trials followed up patients for a median of only 2.3 years, the authors extrapolated … Read More
“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. [..] 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. [..] Health insurers and employers … Read More
“while the U.S. lags behind in adopting value-based agreements, many policymakers are realizing that value-based pricing can be an important, viable solution to the high and rising expenditures that payers lay out for prescription drugs. Developing value-based agreements has never been easier. A large number of value-based agreements are now available and can be used to help payers, manufacturers, and providers develop new ones appropriate to their specific situations. [..] Here are four scenarios for which I believe value-based pricing is appropriate. When expected outcomes for a new treatment are clear and objectively measurable. [..] Treatments with clearly defined, meaningful, … Read More
“Recent legislative proposals, including US Senate Bill S.2543, US House of Representatives Bill HR 3, and various Trump Administration proposals and plans, have advanced some form of international reference pricing (IRP) to lower drug prices. As its name suggests, IRP seeks to benchmark US drug prices to prices of similar or comparable drugs in other counties. Some proposals would have the federal government develop a reference price index based on prices paid by a select group of high-income countries, and then restrict prices to a narrow range of the index. [..] American drug pricing policy rewards large capital investments and … Read More
“the F.D.A.’s decision to grant the drug full approval — which means the company can now begin broadly marketing it to doctors and patients — has puzzled several outside experts, who say that it may not deserve the agency’s stamp of approval because it is, at best, a mediocre treatment for Covid-19 [remdesivir..]. “I think most people think that because a drug is F.D.A. approved, that means it must work,” said Dr. Aaron S. Kesselheim, a professor of medicine at Harvard Medical School who studies the drug industry. He and other researchers recently found that less than one-third of new … Read More
“The Centers for Medicare & Medicaid Services recently announced a voluntary plan to cap out-of-pocket costs associated with insulin products in participating enhanced Part D plans. However, this model will not apply to other high-cost glucose-lowering medications such as sodium-glucose cotransporter 2 (SGLT2) inhibitors and glucagon-like peptide 1 (GLP-1) receptor agonists. These classes are increasingly used as second-line agents for patients with type 2 diabetes despite only a modest effect on glycemic control (approximately 0.8% to 1%) because of mounting evidence of cardiovascular benefits. We sought to examine contemporary coverage and out-of-pocket costs for beneficiaries filling either an SGLT2 inhibitor … Read More
“The program [Medicare Part D] itself does not negotiate drug prices with pharmaceutical companies. Instead, the government partners with pharmacy benefit managers (PBMs) to leverage its market power and reduce drug prices for seniors in Part D. Insurance companies, unions, large employers, and state governments also engage PBMs in similar arrangements. By representing such a wide swath of the purchasers of prescription drugs, PBMs can use their purchasing power to negotiate lower prices from pharmaceutical companies. [..] the Department of Health and Human Services has issued a rule that would limit their ability to pass back the rebates they negotiate … Read More
“This study was produced independently by the IQVIA Institute for Human Data Science as a public service, without industry or government funding. [..] In 2019, the United States spent $493 billion on medicines at ex-manufacturer invoice prices, including $211 billion on biologics, which now comprise 43% of total medicine spending. [..] The correlation between the magnitude of molecule sales and the number of biosimilar competitors attracted to the space is not as robust as expected. Rather it appears that the selection of molecules for biosimilar development may be influenced by multiple factors such as technical complexity, intellectual property issues, or … Read More