April 3, 2014
Legislation that (SB 1014) passed out of the Florida Senate Appropriations Subcommittee on General Government would create new powers for independent drugstores to charge employers, seniors and unions higher prices for generic drugs, the Pharmaceutical Care Management Association (PCMA) said today.
The new legislation, along with a similar bill (HB 765), undermines the use of Maximum Allowable Cost (MAC) generic drug lists that employers and public programs use to prevent them from overpaying for generic drugs and could increase Florida’s prescription drug costs by $422.5 million annually. MACs are necessary because generics — unlike brands — often have inflated manufacturer “list” prices that don’t reflect what a pharmacy actually spent to buy the drug. These MAC lists are widely used by large and small employers, unions, state employee health plans, Medicaid and other health plans.
“Unfortunately for Florida’s employers, unions, government agencies, and consumers, this legislation will only increase what they pay for generic drugs,” said PCMA President and CEO Mark Merritt. “This increases independent drugstore profits at the expense of employers and consumers.”
A recent analysis from the Health and Human Services Office of Inspector General (OIG) demonstrated “the significant value MAC programs have in containing Medicaid drug costs.” The OIG recommended that states strengthen MAC programs, not weaken them.
The Florida legislature is also considering separate bills that undermine proven tools used by pharmacy benefit managers (PBMs) to lower prescription drug costs. Restricting these tools could increase prescription drug costs by $12 billion over 10 years for the state’s employers, seniors, unions, and consumers.
With the help of PBMs, Florida consumers, employers, unions, and the state government will save $97.5 billion in prescription drug costs over the next decade. PBMs accomplish this by:
- Negotiating discounts from drugstores and drug manufacturers.
- Offering home delivery of medicines.
- Encouraging the use of generics and less expensive brands.
- Using cutting-edge tools to improve medication adherence.
- Improving quality and safety.