Provider groups outraged by FTC’s refusal to allow study of PBMs

WASHINGTON — Pharma and provider organizations are disappointed with the Federal Trade Commission’s (FTC) decision not to launch a study of the marketing and financial practices of pharmacy benefit managers (PBMs) — at least for now.

“These pharmaceutical intermediaries siphon off billions in profits from patients and have been allowed to operate with little oversight for far too long,” said the Coalition for PBM Reform, a group made up of patients, healthcare providers and practitioners. payers, in a press release. “Unfortunately, despite these concerns, a majority of the committee felt that the design of this particular study was not adequate and therefore voted against proceeding. Our coalition is disappointed with this decision today, but looks forward to continuing to educate the FTC and others about PBM practices that harm patients, pharmacies, and health care providers.”

Independent pharmacies say they are wronged

The statement referred to a meeting the FTC held on February 17, during which the four members of the commission discussed whether to “study the competitive impact of contractual provisions, reimbursement adjustments and other practices affecting the prices of medicines, including practices likely to disadvantage independent or specialist pharmacies.

Two members of Congress – both Republicans – testified in favor of conducting a study. “For many rural, small-town communities in my district, these long-standing local pharmacies are often the only provider of vital access to medical prescriptions and other services and consultations,” said Rep. John Rose (R- Tenn.). “Unfortunately, PBMs, like the big three – Aetna, CIGNA and UnitedHealth Group – collectively control 77% of the market and have made serving communities much more difficult for these family pharmacies.”

“PBMs have put tremendous pressure on local pharmacies by leveraging their market power and business relationships to drive up costs for community pharmacies, particularly through the use of take-it-or-leave-it contracts,” he continued. “My constituents and I strongly support the Federal Trade Commission’s study of PBMs and all efforts by the FTC to verify individual pharmacy recovery information for PBMs.”

Rep. Buddy Carter, PharmD (R-Ga.), who has run his own pharmacy for 30 years, noted that PBMs “have increased those retroactive fees by 91,500% in recent years — it’s like a gallon of milk that now costs over $3,600. They are also blackmailing manufacturers into increasing the list price of drugs in exchange for more discounts. PBMs then pocket these discounts instead of passing the savings on to the customer. This practice is increasing drug costs dramatically, even though list prices for brand name drugs are falling on average for the fourth year in a row.”

Carter said his wife received a call from her PBM saying she could get a particular drug cheaper through their mail-order service than from Carter’s own pharmacy. “This is just a way for PBMs to drive patients away from independent pharmacies and put them out of business. State Medicaid programs also pay out billions to PBMs through convoluted spread practice contracts This study must be authorized.”

Unfair refund questions

In a telephone interview with a public relations officer present, Matthew Seiler, general counsel for the National Community Pharmacists Association (NCPA), said that PBMs engage in anti-competitive practices in order to refer patients to pharmacies that they own or are affiliated with. One way to do this is “to use punitive auditing practices — [performing] up to two audits per month on [competing] pharmacies, and they will find minor violations, and they will remove a pharmacy from the preferred network. »

Another PBM practice — which the NCPA thinks is likely illegal — is for the PBM to compensate its own pharmacies at a much higher rate than competing independent pharmacies, Seiler said. For example, a study by the Arkansas Pharmacists Association found that CVS Caremark PBM paid CVS pharmacies $525 for a bottle of 30 tablets of 30 mg aripiprazole, but paid independent pharmacies $35 for the same. medication.

Commissioners also heard from disgruntled patients. Beth Waldron of Raleigh, North Carolina, said her PBM sent her a letter telling her that the blood thinner she was taking — apixaban (Eliquis) — would no longer be covered and that she should switch to rivaroxaban ( Xarelto). “Clinical studies show that Eliquis has superior efficacy and safety compared to Xarelto… The removal of Eliquis from the formulary was considered so dangerously disruptive that 16 cardiovascular nonprofits requested [the PBM] reverse [its] decision, including the American College of Cardiology and the American Society of Hematology,” to no avail, she said.

“Patients are captive consumers of PBM,” Waldron added. “We don’t choose a drug benefit manager; our insurance plan does…We have no recourse, but PBMs have a great deal of latitude over our lives in determining what drugs we can access, at what price , even have the power to change our drugs. direct prescribing advice from our doctors. These are the very conditions under which federal consumer protections are needed. I encourage the FTC to step in, to help protect consumers PBM practices.

Vote divided along party lines

The committee also heard from pharmacists and health care providers who criticized PBM’s practices. All of the public speakers who spoke at the meeting were in favor of the study. But in the end, the commissioners, who include two Democrats and two Republicans, split 2-2 along party lines in a vote on whether to authorize the study; a tie vote meant the motion failed.

Commissioner Noah Phillips, JD, a Republican, objected to the way the study was designed, saying it “was not designed to assess the competitive effects of those contract provisions that we would study, including on independent pharmacies The study was a study of trends, not The study will also not tell us how the contractual provisions at issue might affect drug prices in general or the drug costs that consumers pay when they go to the pharmacy to get their prescriptions.

“We must [perform] a study that can inform the public about whether and how these practices might impact consumer drug costs,” he concluded. I will vote ‘no'”. He added, however, that there “remained[s] open to working with my colleagues on a study that can generate useful information on prescription drug costs and the role and impact of PBMs. »

Commission Chair Lina Khan, JD, a Democrat, expressed an opposing view. “Despite the agency’s limited resources, I believe it is vital to initiate this study,” she said. “We have an imperative to better understand and ultimately address anti-competitive behaviors that can contribute to soaring drug prices and the decline of independent pharmacies, and better understanding the role of PBMs is a key part of this work.”

Asked to comment on the FTC’s action, the Pharmaceutical Care Management Association, a trade group for PBMs, did not respond directly but said in a statement that “We look forward to working with Congress and the administration on ways to increase accessibility and access to prescriptions”. medicine for all patients. Pricing by drug manufacturers is the root cause of high drug costs, which strains patients and forces them to make difficult decisions about their medications. PBMs hold pharmaceutical companies accountable by relentlessly negotiating the lowest possible cost on their patients’ behalf, and drive and deliver the local competition that patients demand. »

  • Joyce Frieden oversees MedPage Today’s coverage in Washington, including stories about Congress, the White House, the Supreme Court, professional health associations and federal agencies. She has 35 years of experience in health policy. To follow

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