PBMs/Pharmacy Benefit Managers

Commercial Insurance Restrictions Complicate Biosimilar Adoption

Since the FDA’s approval of the first biosimilar in 2015, the agency has approved almost 40 more agents. However, their adoption in the U.S. market has been slow. A recent study, published in the journal BioDrugs, found that biosimilars were covered more restrictively than their reference biologics in 19.4% of coverage decisions made by select commercial health plans.

The study examined 1,181 coverage decisions made by 17 commercial health plans as of August 2021 from the Tufts Medical Center Specialty Drug Evidence and Coverage database, which included 19 commercially available biosimilars for seven biologic reference products used in treating 28 conditions.

0 Comments

Proposed Rule Targets PBMs’ Medicaid Practices, Creates Pharma Pricing Audit

In a new regulation released on May 23, the Biden administration proposed increasing drug price transparency reporting by pharmacy benefit managers and pharmaceutical manufacturers supplying Medicaid — and requiring Medicaid managed care organizations to remove pharmacy benefit administration costs from medical loss ratio (MLR) reporting. Experts say the proposed rule is a marginal but meaningful step forward in prescription drug cost containment, but they add that the proposed rule won’t do as much as bills under serious discussion in Congress to rein in controversial PBM business practices such as spread pricing.

The proposed rule, which CMS says in a fact sheet “implement[s] new statutory authorities included in the Medicaid Services Investment and Accountability Act of 2019,” is meant to improve the Medicaid Drug Rebate Program by “proposing new policies that would assure greater consistency and accuracy of drug information reporting, strengthened data collection, and efficient operation of the MDRP.” Per the fact sheet, notable elements of the regulation include:

0 Comments

Commercial Insurance Restrictions Complicate Biosimilar Adoption

Since the FDA’s approval of the first biosimilar in 2015, the agency has approved almost 40 more agents. However, their adoption in the U.S. market has been slow. A recent study, published in the journal BioDrugs, found that biosimilars were covered more restrictively than their reference biologics in 19.4% of coverage decisions made by select commercial health plans.

The study examined 1,181 coverage decisions made by 17 commercial health plans as of August 2021 from the Tufts Medical Center Specialty Drug Evidence and Coverage database, which included 19 commercially available biosimilars for seven biologic reference products used in treating 28 conditions.

0 Comments

‘Shell Game’ or Rebate Maximizers? FTC Probe Reignites Debate Over GPOs

When the Federal Trade Commission (FTC) announced on May 17 that it ordered Zinc Health Services, LLC, and Ascent Health Services, LLC, to turn over their business records, it was just the latest salvo in a rising tide of scrutiny directed at PBM-affiliated group purchasing organizations (GPOs).

One former FTC official says the agency has a range of powers it can wield to find out more about PBM-linked GPOs — and even potentially change how they do business. Yet the PBMs that own and use such rebate-aggregating organizations say their reputation as shadowy, overseas entities belies the GPOs’ simple goal of extracting larger drug discounts from manufacturers.

0 Comments

House Hearing, Legislation Emphasize PBM Transparency

During a May 23 hearing held by the House Oversight and Accountability Committee, both Republican and Democratic representatives — as well as the witnesses — seemed to agree that PBM reforms are needed. However, a consensus wasn’t clear on what policies are best suited to fix problems with the current pharmacy benefits landscape, other than mandating increased transparency into how PBMs do business.

Just one day after the hearing, another House panel — the Energy and Commerce Committee — advanced the Promoting Access to Treatments and Increasing Extremely Needed Transparency (PATIENT) Act of 2023, which would require PBMs to annually report to employer plan sponsors a host of information about prescription drug spending, utilization, acquisition costs, rebates and more. Specific to the Medicaid program, the legislation would also ban spread pricing, which occurs when PBMs pay pharmacies dispensing a drug less than what they charge payers and pocket the difference. The Biden administration on May 23 proposed a regulation that targets spread pricing in Medicaid, but it does not ban the practice.

0 Comments

Proposed Rule Targets PBMs’ Medicaid Practices

In a new regulation released on May 23, the Biden administration proposed increasing drug price transparency reporting by PBMs and pharmaceutical manufacturers supplying Medicaid — and requiring Medicaid managed care organizations to remove pharmacy benefit administration costs from medical loss ratio (MLR) reporting. Experts say the proposed rule is a marginal but meaningful step forward in prescription drug cost containment, but they add that the proposed rule won’t do as much as bills under serious discussion in Congress to rein in controversial PBM business practices such as spread pricing.

The proposed rule, which CMS says in a fact sheet “implement[s] new statutory authorities included in the Medicaid Services Investment and Accountability Act of 2019,” is meant to improve the Medicaid Drug Rebate Program by “proposing new policies that would assure greater consistency and accuracy of drug information reporting, strengthened data collection, and efficient operation of the MDRP.” Per the fact sheet, notable elements of the regulation include:

0 Comments

House Committee Hearing Targets PBMs, Provider Consolidation

During a May 17 hearing, PBMs and merging hospitals were in the crosshairs of a U.S. House of Representatives subcommittee considering policies to slow the growth of health care prices. Although independent experts called as witnesses agreed with members’ assertions that PBMs, hospital mergers, and hospital purchases of independent physicians exacerbate high health care costs, the experts also pointed out that prices are already too high, and preventing hospital mergers or reining in PBMs will do little to reverse decades of price growth.

The hearing, titled “Why Health Care is Unaffordable: Anticompetitive and Consolidated Markets,” was convened on May 17 by the Health Subcommittee of the House Ways and Means Committee. The hearing piled on to the growing momentum across Congress that seems likely to result in more stringent PBM regulations, with majority Republicans tipping support for policies that would rein in PBMs.

0 Comments

Senate, House Panels Advance Plethora of PBM Reform Measures

In the space of a week, multiple PBM-regulating bills have advanced in House and Senate committees that address a variety of concerns about how the industry does business. However, industry observers say it’s still unclear what reforms will prevail in the push to overhaul a sector that is increasingly bearing blame for creating a byzantine and expensive drug pricing system.

“It’s one of those things where it’s not a burning issue that you can poll and constituents go crazy about, but the issue of PBMs and what the heck are they — and the feeling that there is something potentially improper about the way they’re doing [their job] — may be enough to get legislation [passed],” says James Shehan, chair of the FDA regulatory practice at the law firm Lowenstein Sandler LLP.

0 Comments

News Briefs: Senate Panel Advances PBM Reform Bill

Following a hearing on insulin costs in which senators from both political parties grilled PBM executives, the Senate Health, Education, Labor and Pensions (HELP) Committee approved the Pharmacy Benefit Manager Reform Act of 2023 (S. 1339). The legislation would ban spread pricing, introduce a host of transparency requirements, and compel PBMs to pass on rebates and fees they collect to their health plan clients, Pink Sheet reported. However, HELP Committee Chairman Bernie Sanders (I-Vt.) would not allow a vote on an amendment that would prohibit PBMs from charging administrative fees based on a percentage of a drug’s list price, as that amendment did not yet have a Congressional Budget Office score. The measure passed on an 18-3 vote with Sen. Rand Paul (R-Ky.), Sen. Mitt Romney (R-Utah) and Sen. Tommy Tuberville (R-Ala.) voting no.

0 Comments

PBMs Can Do Little to Prevent, Mitigate Drug Shortages, Experts Say

Drug shortages have grabbed headlines in recent months, with patients struggling to fill prescription medications that treat conditions including asthma and attention-deficit/hyperactivity disorder (ADHD), and providers struggling to stock and administer specialty drugs, especially in oncology. Experts tell AIS Health, a division of MMIT, that PBMs don’t have an abundance of options to ameliorate the shortages and may be unlikely to try the limited workarounds that they do have.

New research prepared for the American Society of Health-System Pharmacists (ASHP) by researchers from the University of Utah found that 301 drug shortages were in effect by the end of the first quarter of the year — a five-year high.

0 Comments