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President Biden just signed the Inflation Reduction Act into law ─ legislation that is going to harm Patient access to innovative medicines by allowing government price setting on new treatments. Unfortunately, this legislation fails to address one of the true drivers of high costs in the healthcare system: industry middlemen known as pharmacy benefit managers (PBMs). PBMs negotiate rebates and fees with drug manufacturers, create drug formularies and reimburse pharmacies for Patients’ prescriptions. However, far too often, PBMs fail to pass along these manufacturer rebates and discounts to Patients at the pharmacy counter.
Just three PBMs, all owned by giant for-profit insurance companies, control approximately 80% of the entire PBM middleman industry in the U.S. PBMs have an enormous influence over the treatments that Patients can access, which can lead to higher costs for families when the most expensive drugs are prioritized in their formulary. Higher out-of-pocket costs can contribute to lower levels of treatment adherence and higher levels of treatment abandonment, leading to worse health outcomes for Patients with chronic and hard-to-treat conditions.
Recently, the Federal Trade Commission (FTC) voted unanimously to launch an inquiry into the PBM industry, with a specific focus on how these middlemen impact the ability of Patients to access and afford their medicines.
A new BioNJ infographic details the impact that PBMs have on Patients – from failing to pass along rebates to reduce Patient out-of-pocket costs to worsened health outcomes due to treatment abandonment.
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