(Washington, DC)—A report released today finding that U.S. consumers could save more than $20 billion by using more generic drugs highlights the huge savings in jeopardy if provisions to extend the market exclusivity of branded drugs are included in biodefense legislation now under consideration by Congress. Extending market exclusivity for branded drugs would dramatically increase prescription costs in the Medicare and Medicaid programs as well as for consumers in private health plans.

In the next year alone, generic alternatives are expected to become available for at least 15 branded drugs, according to the new “Generic Drug Usage Report” published by Express Scripts Inc. The average generic drug prescription costs approximately $45 less than the equivalent brand-name prescription, which translates into billions in savings for consumers each year.

“Generic drugs are a strong line of defense against increasing drug costs,” says PCMA President Mark Merritt. “We support a strong biodefense policy to develop countermeasures, but provisions to extend marketing exclusivity on branded drugs would take us in the wrong direction at a time when Medicare and private purchasers are looking to expand access to clinically proven, cost-effective medications.”

Together with a broad-based coalition of the nation’s employers, health insurers, chain drugstores, and generic drug makers, PCMA urges Congress to reject extending drug marketing exclusivities in favor of common sense solutions to biodefense preparedness, such as product liability protections, tax credits for research and manufacturing facilities, guaranteed purchasing, and government funding to accelerate and support the research and development of novel countermeasures.

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The Pharmaceutical Care Management Association (PCMA) is the national trade association representing America’s pharmaceutical benefit managers (PBMs). PCMA member companies provide pharmaceutical care management services to more than 200 million Americans.

Contact Information:
Tim Brogan
(202) 207-3603

(Washington, DC)—A report released today finding that U.S. consumers could save more than $20 billion by using more generic drugs highlights the huge savings in jeopardy if provisions to extend the market exclusivity of branded drugs are included in biodefense legislation now under consideration by Congress. Extending market exclusivity for branded drugs would dramatically increase prescription costs in the Medicare and Medicaid programs as well as for consumers in private health plans.

In the next year alone, generic alternatives are expected to become available for at least 15 branded drugs, according to the new “Generic Drug Usage Report” published by Express Scripts Inc. The average generic drug prescription costs approximately $45 less than the equivalent brand-name prescription, which translates into billions in savings for consumers each year.

“Generic drugs are a strong line of defense against increasing drug costs,” says PCMA President Mark Merritt. “We support a strong biodefense policy to develop countermeasures, but provisions to extend marketing exclusivity on branded drugs would take us in the wrong direction at a time when Medicare and private purchasers are looking to expand access to clinically proven, cost-effective medications.”

Together with a broad-based coalition of the nation’s employers, health insurers, chain drugstores, and generic drug makers, PCMA urges Congress to reject extending drug marketing exclusivities in favor of common sense solutions to biodefense preparedness, such as product liability protections, tax credits for research and manufacturing facilities, guaranteed purchasing, and government funding to accelerate and support the research and development of novel countermeasures.

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The Pharmaceutical Care Management Association (PCMA) is the national trade association representing America’s pharmaceutical benefit managers (PBMs). PCMA member companies provide pharmaceutical care management services to more than 200 million Americans.

Contact Information:
Tim Brogan
(202) 207-3603

Higher Prescription Drug Costs Foreseen for Medicare, Medicaid and Private Plans If Measure Becomes Law

Coalition Supports Biodefense Preparedness, Opposes Monopoly Protections for Brand-Name Drug Manufacturers

(Washington, DC)—The Coalition for a Competitive Pharmaceutical Market (CCPM) today called on the U.S. Senate to reject provisions included in Biodefense legislation that would extend drug monopolies for brand-name drug manufacturers, warning that the provision will dramatically increase prescription drug costs in the Medicare and Medicaid programs as well as for consumers in private plans. As part of this announcement, CCPM released a copy of a letter it has sent to every Member of the U.S. Senate and announced a new round of advertising to increase awareness about the harmful consequences of the market exclusivity provision.

The Coalition for a Competitive Pharmaceutical Market is an unusually broad-based coalition comprising organizations representing the nation’s employers, health insurers, chain drugstores, generic drug makers, and pharmacy benefit managers (PBMs).

“CCPM urges the U.S. Senate to reject the market exclusivity provisions because they would unnecessarily drive up prescription drug costs for private and public payers without advancing our nation’s bioterrorism preparedness,” said CCPM Chairman Annette Guarisco. “CCPM continues to support real solutions to biodefense preparedness, including tools to minimize product liability, tax credits for research and manufacturing facilities, guaranteed purchasing, and government funding to accelerate and support the research and development of novel countermeasures.”

The drug monopoly extensions are included in, S. 1873 the Biodefense and Pandemic Vaccine and Drug Development Act of 2005, which was approved by the Senate Health, Education, Labor and Pensions Committee earlier this week and could be considered by the full Senate as early as next week. The measure would broaden the definition of products eligible to be used as countermeasures in a way that could grant existing everyday medicines—rather than novel products related to the fight against bioterrorism—multiple years of additional market exclusivity.

“For private and public purchasers seeking to provide consumers with therapeutically equivalent, but more cost-effective generic drugs, the market exclusivity provision included in the Biodefense bill takes us in exactly the wrong direction,” said Mark Rubino, Chief Pharmacy Officer, Aetna Inc., a CCPM member.

“This drug monopoly extension proposal is a sweeping and unprecedented measure that would rewrite drug-patent law and force working families, the disabled, and seniors to pay more for their prescription drugs,” said Mark Merritt, President of the Pharmaceutical Care Management Association (PCMA), the national association representing pharmacy benefit managers and a CCPM member. “Perhaps most troubling of all, this measure has moved forward without any regard to the cost impact it would have on Medicare, Medicaid, and private payers. America’s working families, seniors, and small businesses deserve better.”

CCPM Letter to Senators Frist and Reid

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Contact Information:
Phil Blando, 202-207-3614
Katie Braden Huffard, 202-255-5216
Andrea Hofelich, 703-647-2495

PCMA Supports Bioterrorism Preparedness,
Opposes Drug Patent Extensions

(Washington, DC)—As policymakers continue to work on proposed legislation aimed at developing countermeasures to bioterrorism, the Pharmaceutical Care Management Association (PCMA) today raised a number of unanswered questions about possible brand-name drug patent extensions, their impact on prescription drug costs throughout the entire health care system, and whether they even advance the goals of effective bioterrorism preparedness. PCMA is the national association representing America’s pharmacy benefit managers (PBMs), which administer prescription drug plans for 200 million Americans.

“PCMA believes that a strong national defense policy should include efforts to develop effective countermeasures to combat bioterrorism,” said PCMA President Mark Merritt. “Regrettably, some of the drug patent extension proposals being discussed raise serious concerns about the overall cost impact and whether they would even advance the goals of bioterrorism preparedness. At a time when private and public purchasers are looking to expand access to clinically proven, cost-effective drugs, brand-name drug patent extensions take us in exactly the wrong direction.”

While strongly supportive of efforts to develop effective bioterrorism countermeasures, PCMA believes that some of the proposals under consideration in Congress raise serious cost and quality concerns. Among the unanswered questions about proposals extending brand-name drug patents and whether they advance the goal of bioterrorism preparedness:

�¼ How much would drug patent extensions increase prescription drug costs for working families and seniors? How much would drug patent extensions increase prescription drug costs and/or benefit costs for private health-care purchasers, including unions, small businesses, and large employers?

�¼ How much would consumers see their health benefits eroded or eliminated because of the costs associated with drug patent extensions? What effect would this proposal have on health care quality as patients might find themselves unable to afford or without coverage for needed medicines?

�¼ How much would drug patent extensions increase costs and part D premiums in the new Medicare prescription drug benefit?

�¼ How would drug patent extensions advance the goals of bioterrorism preparedness, including issues related to guaranteed purchasing, distribution, and minimizing product liability?

PCMA is participating in the Coalition for a Competitive Pharmaceutical Market (CCPM). The Coalition, comprised of employers, health insurers, generic manufacturers, PBMs, and retail pharmacy, sent a letter today to members of the Senate Health, Education, Labor, and Pensions (HELP) Committee outlining its concerns with drug-patent extensions. In addition, the Coalition is running a print advertising campaign inside the Beltway.

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CCPM Letter to Sen. Richard Burr

CCPM Print Ad

Contact Information:
Phil Blando
202-207-3614

(Washington, DC)—As policymakers continue to debate how best to incorporate fully evidence-based medicine and comparative effectiveness into the Medicare program, a piece published today in the New England Journal of Medicine (NEJM) underscores that pharmacy benefit managers (PBMs) are ahead of the curve and have the potential to utilize these tools in administering the new Medicare prescription drug benefit, the Pharmaceutical Care Management Association (PCMA) said today. PCMA is the national association representing America’s pharmacy benefit managers.

“PBMs have been at the forefront of efforts to incorporate comparative effectiveness and other evidence-based medicine tools into the prescription-drug benefit arena,” said PCMA President Mark Merritt. “In Medicare, policymakers have only begun to scratch the surface in realizing the potential of these tools. A key challenge lies in avoiding a ‘one-size-fits-all’ approach, while at the same time promoting value-based purchasing. To that end, PCMA believes strongly that increased choice, competition, and information in Medicare will ensure that beneficiaries have access to cost-effective, clinically-sound prescription drugs.”

The piece, “Medicare and Cost-Effectiveness Analysis,” is running in the new issue of the NEJM and is authored by analysts at the Harvard School of Public Health, University of Michigan Health System, and the Ann Arbor Veterans Affairs Medical Center. Among the highlights:

Cost-effectiveness information in the Medicare prescription drug benefit will assume a more important role at the plan level, rather than at the national level. The authors note that “in all likelihood, plans’ use of cost-effectiveness information to guide (formulary) decisions will increase, expanding on the growing movement among many plans and pharmacy-benefit managers to adopt evidence-based and value-based formulary guidelines.” The Medicare Modernization Act requires the Agency for Health Care Research and Quality (AHRQ) to initiate a pilot comparative effectiveness research project in number of areas of health care, including prescription drugs.

A government-only approach to comparative effectiveness is not politically feasible. The authors note the many historical challenges associated with the federal government taking the lead on comparative effectiveness research. As an alternative, the authors recommend “a new Institute of Medicine-like entity” that would develop and distribute non-binding information and advice as public goods. Private and public purchasers â?? including the Medicare program â?? would be free to accept or reject its recommendations. As the authors themselves note: “the non-binding nature of these recommendations is important: decision makers themselves would decide how much weight to give cost-effectiveness evidence and how much to give to other factors.” The authors also note that one of the many challenges in implementing this approach lies in funding.

Comparative effectiveness is not a silver bullet. The authors conclude that “cost-effectiveness analysis will not solve all of Medicare’s problems. Policymakers would do well to keep expectations modest. Cost-effectiveness analysis must be part of a comprehensive strategy that involves changing incentives at multiple levels.”

PBMs rely upon panels of independent, clinical experts, called Pharmacy & Therapeutics (P&T) committees, to determine which drugs are most effective for specific needs before any cost considerations are taken into account. P&T committees are largely independent providers and include a variety of specialist physicians, pharmacists, and others with specific clinical knowledge of drugs and pharmacotherapy. These committees serve in an evaluative, educational, and advisory capacity in matters concerning formulary development and management. Primarily, this capacity is served in evaluating drugs for safety and efficacy. Development and maintenance of formularies is an ongoing activity, as they must be continually updated to keep pace with new therapies, recent evidence from clinical research, changes in medical practice, and FDA guidance. When drugs are determined to be therapeutically equivalent, PBM get the drug manufacturers of those respective drugs to compete and offer discounts in exchange for better placement on formularies.

New England Journal of Medicine article (PDF)

The Frontier Of Specialty Pharmacy Care: An Examination of Primary Disease States