Bass Explains Opposition to Legislation, Risk of Drug Companies Lowering Rx Discounts 

On Wednesday, expert witnesses testifying before the U.S. House Committee on Energy & Commerce Subcommittee on Health highlighted the critical value pharmacy benefit companies provide for patients, employers, and taxpayers, the unintended consequences of misguided proposals targeting pharmacy benefits, and the importance of focusing on solutions that will actually lower drug prices to improve the affordability of medicines.

Kristin Bass, Chief Policy and External Affairs Officer for the Pharmaceutical Care Management Association (PCMA), explained how pharmacy benefit companies provide critical value for hundreds of millions of Americans. She said:

“We’re proud that pharmacy benefit companies are hired to administer prescription drug plans for more than 275 million Americans who have health coverage through public and private employers, labor unions, Medicare, other federal programs, and the exchanges…”

“So, why do plan sponsors choose to use a pharmacy benefit company? They rely on our companies’ expertise to secure savings through price concessions from drug companies, to partner with lower cost, higher quality pharmacies, and to improve medication adherence. For small employers, who may struggle even to provide health benefits, pharmacy benefit companies offer options for cost predictability, enabling them to stretch their benefit dollars further.”

When asked if pharmacy benefit companies support price transparency, Bass said:

“PBMs fully agree data that will help lead to lower costs, that people can actually use to lower costs, should be transparent. We have no disagreement about that… [But] in federal bidding for contracts, you don’t have those bidders bid openly so that every competitor knows what the competitor’s best price is. You don’t do that…We think that if every drug manufacturer knew what the other’s best deal [discount] was, they wouldn’t be as willing to go as deep [on rebates] as they are currently going.”

“Beyond that, our companies make tools available so that at the…point of prescription, doctors can…know what the cost sharing is going to be for a given patient and that the patient is going to know what’s going to be on their formulary. Our companies are very transparent in their contracts with employers and respond to employers’ requests for information and put that in contracts.”

Bass also cautioned against legislation targeting pharmacy benefits and the unintended consequences that would lead to higher costs as well as less choice and flexibility for plan sponsors and urged lawmakers to focus on the root cause of high drug prices – the lack of competition in the marketplace caused by big drug companies’ abuse of the patent system. She said:

“We have two major concerns that carry through many of the bills proposed to address prescription drug costs. First, the legislation would limit choice by dictating terms to the market, taking away flexibility that is needed for managing drug costs, keeping health coverage affordable, and helping patients stay on their meds…”

“Second, none of the legislation being considered today would address the price of prescription drugs, but may instead increase costs, not only by limiting choice, but by stacking the deck in favor of drug companies when it comes to negotiations for rebates. We have to be cognizant of what happens when one side in a negotiation gets confidential information about their competitors’ negotiated rates, it only leads to higher costs.”

“We encourage the subcommittee to address the actual cause of the affordability challenge – the price set by the drug company and the rampant patent abuses that have blocked competition.”

Loren Adler, Fellow and Associate Director of the USC-Brookings Initiative for Health Policy, underscored the role pharmacy benefit companies play in securing lower costs. Adler said:

“Fundamentally, the PBM’s role is to negotiate lower drug prices on behalf of purchasers and certainly plans wouldn’t hire them if they weren’t getting them lower prices, I think that part is fundamental… PBMs are generating lower costs and drug prices than what would be without them.”  

Learn more about public policy solutions that would promote competition in the prescription drug market and effectively lower prices for patients HERE.

Learn more about the role and value of pharmacy benefit companies HERE.

###

PCMA is the national association representing America’s pharmacy benefit companies. Pharmacy benefit companies are working every day to secure savings, enable better health outcomes, and support access to quality prescription drug coverage for more than 275 million patients. Learn more at www.pcmanet.org