We're co-sponsoring a zoom webinar Wednesday, June 24, at noon ET on two ways consumers and patients are harmed by drug industry price manipulation and lack of competitive restraints. Consumers often don't get a fair price and don't always get an effective drug. You can register here for the "Rebate Walls and Step Therapy" event.
Panelists will discuss the pros-and-cons of "step therapy" (requiring patients to try low-cost drugs before "stepping" up to higher-priced drugs in the formulary). The process is favored by insurance-companies as a cost-control measure and seems reasonable on face. But it also may unreasonably delay access to a drug that works. Further, the jury is still out on whether step therapy actually lowers patient costs.
And while most consumers associate rebates with a good deal, we joined labor unions and consumer groups in opposing the inadequate conditions imposed in a recent FTC settlement of a massive pharmaceutical merger because "rebate walls" would be used to forestall competition. As we said in a coalition letter to the FTC:
"Some people might question whether rebates can be anticompetitive since they may appear to be price discounts. As a preliminary matter, pharmaceutical rebates raise even greater concern than rebates or discounts in other industries. There is increasing evidence that rebates drug manufacturers offer pharmacy benefit managers and health plans (“payors”) to get expensive biologics on their formularies actually raise the cost of prescription drugs. This is why the [Trump] Administration proposed eliminating rebates, a reform supported by major consumer groups. What is important to understand about these rebates is that they are not discounts for patients. Because the rebates go to payors, rather than to consumers, payors have perverse incentives to negotiate higher list prices so they can secure higher rebates – without regard to patient wellbeing or patient cost. The Administration’s proposal clearly documented that rebates lead to higher list prices and deter innovation. These rebates actually increase patients’ costs because the patients’ coinsurance is based on the inflated list price of the branded drug. If the patients had access to lower cost branded drugs, their coinsurance costs would go down. A rebate wall or trap has even worse implications for patients. They are erected when an incumbent manufacturer uses existing market power to secure preferred formulary access for its drug by offering volume-based rebates to payors, on the condition that they deny or limit the formulary access of rival drugs."
Among the webinar speakers are Professor Robin Feldman, author of the book "Drugs, Money and Secret Handshakes: The Unstoppable Growth of Prescription Drug Prices"and Holly Vedova, attorney-advisor to FTC Commissioner Rohit Chopra, who dissented in the recent Big Pharma mega-merger.
You can register here for the "Rebate Walls and Step Therapy" event. Here's a link to a recent comment letter from U.S. PIRG and other groups supporting many reforms proposed by the Trump Adminstration to rein in skyrocketing prescription drug prices.
Photo credit: wavebreakmedia via Shutterstock.com.