WSJ Editorial Wrong On FTC Lawsuit On PBMs I agree more with the Wall Street Journal (WSJ) editorial page than not, but the newspaper was dead wrong in an editorial yesterday on the Federal Trade Commission (FTC) lawsuit against pharmacy benefits managers (PBMs). On one hand, I understand the WSJ’s complaint that the FTC appears to be singling out the PBMs when rebates are legal in government-sponsored programs. I defend much of what PBMs do. The WSJ is right, too, that brand drug makers were effectively portrayed as victims. The WSJ says the suit could lead to higher insurance costs and premiums, and notes that net insulin prices have come down over time. It also says PBMs should not be blamed if employer groups and health plans do not pass the rebate through to the consumer (some now do) and that rebates account for just a small share of profits.

STAT Opinion Piece By MA Opponents Uses Misleading Statistics A STAT opinion piece written by two well-known opponents of Medicare Advantage (MA), Paul Ginzburg and Steve Lieberman, again uses misleading statistics to attack the program and argues MA is exorbitantly overpaid. The authors have some recommendations, such as a move to standardization and delinking MA rate setting from the traditional fee-for-service (FFS) program over time, that could be considered with a more dispassionate discourse on the program overall. But their misleading statistics on the overpayment issue makes it difficult to take their recommendations seriously. They argue the MA overpayment is more than $80 billion or 22%, generated by “beneficial selection” and “upcoding.” I have argued there is some over-reimbursement and that some reforms need to be made on risk adjustment. And many others have dispelled what the critics here say and what MedPAC, the congressional policy arm, constantly reports. Another

Major News On GLP-1 Weight-Loss Drugs Denmark-based Novo Nordisk CEO Lars Fruergaard Jørgensen appeared before the Senate HELP Committee today but refused to absolutely commit to reducing the price of his GLP-1 weight-loss drugs, Wegovy and Ozempic. In a usual tactic for brand drug makers, the CEO blamed pharmacy benefits managers (PBMs) for the high costs of such drugs as they do not largely pass-through rebates to consumers at the point of sale. But what the CEO did not mention is that net prices for his drugs in the U.S. would still be measurably higher than in other developed countries. Brand drug makers are making money hand over fist on their drugs and could easily solve the issue by lowering their list prices to reasonable levels and getting rid of rebates altogether. The truth is the brand drug makers and PBMs both benefit from the opaque rebate scheme. The rebate

Big Pharma Gets Partial Win in Medicare Drug Price Negotiations Case The brand drug industry got a partial victory in a Medicare drug price negotiation lawsuit when a federal appellate court partially reversed a Texas federal district court’s decision to dismiss the brand drug lobby’s lawsuit. The higher court said the drug lobby and another entity had standing on a Fifth Amendment claim, but not on others. The district court will now have to hold a full summary judgment briefing on the merits of the plaintiffs’ Fifth Amendment due process claim. This is the only one of numerous claims that Big Pharma has won in its quest to overturn Medicare drug price negotiations. Additional article: https://www.reuters.com/business/healthcare-pharmaceuticals/challenge-us-drug-price-negotiation-program-revived-by-appeals-court-2024-09-20/ (Article may require a subscription.) #drugpricing #ira #branddrugmakers https://insidehealthpolicy.com/daily-news/fifth-circuit-remands-phrma-infusion-provider-case-against-medicare-drug-price At least Eight Payers Exiting Medicare Advantage Becker’s Payer Issues is tracking Medicare Advantage (MA) plan exits. So far, there are eight plans on the

Bombshell FTC Lawsuit Against PBMs The Federal Trade Commission (FTC) unveiled a bombshell lawsuit against the Big 3 pharmacy benefits managers (PBMs) – CVS’ Caremark, Cigna’s Express Scripts, and United’s OptumRx – charging that the PBMs have used formulary placement and rebates to rig the system and disadvantage the American public at the point of sale. The FTC says that the PBMs use the formulary and rebate scheme to line their pockets and to attract business, leaving diabetics dependent on insulin with high prices and often an inability to pay.  Now I have defended PBMs in the past for some of the good they do. I believe the brand drug makers are the real culprits in the drug pricing problem in America. But I also welcome the lawsuit as we need to change the drug price paradigm. Yes, prices are the main culprit and brand drug makers shoulder that blame.