PCMA: Drug Manufacturer Price Hikes Offset by Rebates

WASHINGTON, Dec. 20, 2018 /PRNewswire/ -- Pharmaceutical Care Management Association (PCMA) President and CEO JC Scott issued the following statement on reports that twenty-eight drugmakers are set to raise prescription drug prices in 2019:

"Today's news underscores the fact that drugmakers alone set and raise prescription drug prices. Given these price increases, pharmacy benefit managers' (PBMs) tools to reduce prescription drug costs are more important than ever.

A recent study by Oliver Wyman Consulting showing rebates have reduced costs in Medicare Part D by $34.9 billion is consistent with one company's observation that because of rebates and discounts its overall drugs costs will decrease by five percent.

Despite the important savings driven by PBMs, it is important to understand that drugmakers set and raise prices unrelated to the rebates they negotiate with PBMs."

Analyses proving that PBM-negotiated rebates are not correlated to drugmakers' pricing strategies, include:

• A recent study — Reconsidering Drug Prices, Rebates, and PBMs — shows drug manufacturers alone set prices – independent of rebates. The study highlights top-selling Medicare Part D brand-name drugs with steady price increases and no change in rebate levels over a five-year period from 2012 to 2017. In addition, the study analyzes a number of Medicare Part B drugs, which have no PBM rebates, and large price increases.

• A separate Visante analysis shows no correlation between price increases set by drugmakers and rebates.

• A report by HHS Office of Inspector GeFneral found that the number of brand-name drugs with rebates dropped from 72 percent to 61 percent.

PCMA is the national association representing America's pharmacy benefit managers (PBMs). PBMs administer prescription drug plans for more than 266 million Americans who have health insurance from a variety of sponsors including: commercial health plans, self-insured employer plans, union plans, Medicare Part D plans, the Federal Employees Health Benefits Program (FEHBP), state government employee plans, Medicaid plans, and others.

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SOURCE Pharmaceutical Care Management Association