
Pharma-PBM Battles Escalates on Capitol Hill
Congress have initiated a range of legislative proposals to further manage PBMs and the pharma market.
As policy makers continue to scrutinize and criticize high drug prices, manufacturers are eager to shift some of the blame to pharmacy benefit managers (PBMs), hitting them for demanding high rebates and discounts that boost consumer costs. PBMs, in turn, insist that their efforts save money for health plans and patients by keeping outlays for medicines under control.
Now Congress is stepping in with a range of legislative proposals to further manage PBMs and the pharma market. Pharmaceutical companies, meanwhile, aim to sideline measures that would ratchet down certain drug prices, limit patents, and revise tax policy. In what has been a busy week on Capitol Hill, the legislators also discussed bills to advance generic-drug competition, to revise corporate tax policy, and to lower prices on diabetes therapies for all patients.
Vermont independent Bernie Sanders led the charge at a hearing before the Senate Health, Labor, Education and Pensions (HELP) committee
As a result, the HELP committee approved an extensive PBM reform bill along with three other measures involving FDA and drug policies. Two support generic drug development by curbing citizen petitions to FDA designed to delay competition (S. 1067) and by limiting “parking” strategies that similarly thwart competitive generic drug marketing (S. 1114). The RARE Act (S. 1214) addresses abuses of the seven-year exclusivity period for orphan drugs. And the hefty Pharmacy Benefit Manager Reform Act (S. 1339) swipes at multiple PBM practices, including “spread pricing” and the failure to pass rebates and fees to plans and patients.
These proposals follow similar House and Senate Committee efforts to curb PBM practices. The
As the legislators have advanced reforms related to PBMs and other drug pricing issues, manufacturers, insurers, and PBMs have escalated their attacks on each other. The Pharmaceutical Research and Manufacturers of America (PhRMA) recently launched a wave of anti-PBM television ads highlighting how the middlemen limit patient access to needed medicines and fail to pass on discounts to consumers. Conversely, America’s Health Insurance Plans (AHIP) has financed a million-dollar campaign blaming pharma companies for high drug costs. And the PBMs’ Pharmaceutical Care Management Association (PCMA) is airing ads to highlight the benefits of their operations and the need for drug patent reform.
At this point, it seems that pharma is winning the policy and rhetoric campaign against PBMs, as support has increased among both Republicans and Democrats for legislation requiring these drug middlemen to be more transparent about their operations, particularly rebates negotiated with manufacturers and how they set payments to retail pharmacists. And more is slated to come from the Federal Trade Commission, which continues an investigation into whether PBM practices limit competition.
About the author
Jill Wechsler is Washington editor for BioPharm International.
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