Advisory panel targets 'outsized profits' for pharmacy benefit managers
A new federal report examining ways to drive down drug pricing drew praise Monday from industry observers for criticizing a “lack of transparency” among the pharmacy benefit managers dominating senior care distribution.
The Council of Economic Advisers issued its 30-page review of government policy, industry regulations and potential innovation on Friday. The group specifically called out pharmacy benefit managers as a cost-driver because they have “undue market power against manufacturers and against the health plans and beneficiaries they are supposed to be representing.”
"Consumers in general and seniors in particular will benefit from enhanced congressional and regulatory scrutiny of each link in the drug supply chain," said Alan G. Rosenbloom, president and CEO of the Senior Care Pharmacy Coalition.
"In 2018, no player along the drug distribution chain faces a bigger challenge validating their legitimacy and value proposition than PBMs, who have transformed themselves into a classic oligopoly that puts their own profits ahead of Medicare beneficiaries' well-being," Rosenbloom added.
Rosenbloom noted that while the new CEA report specifically details the fact "three PBMs account for 85 percent" of the prescription drug market, the percentage jumps to more than 90% for seniors living in the nation's long term care facilities and served by LTC pharmacies.