JC Scott: When Will Drug Companies Answer the Call to Lower Egregious Drug Prices

In case you missed it, JC Scott, president and CEO of the Pharmaceutical Care Management Association (PCMA), wrote an op-ed in D.C. Journal calling on drug companies to lower their egregious prices for GLP-1 drugs for weight loss. Scott highlights how pharmacy benefit managers (PBMs) are already doing their part to reduce drug costs and are committed to expanding access to their popular medications, but manufacturers set the price and the ball is in their court to lower prices.

"Last month, three leading pharmacy benefit companies pledged to Sen. Bernie Sanders, the chairman of the Senate Committee on Health, Education, Labor and Pensions - ahead of a recent congressional hearing where major drug manufacturer Novo Nordisk testified on how the company chooses to price popular GLP-1 drugs - that they are committed to facilitating access to these drugs, should Novo Nordisk (and other GLP-1 drug manufacturers) decide to lower the price of certain GLP-1s to $100 or less per patient per month for health plan sponsors.

In fact, PBMs are already working to negotiate lower costs for GLP-1s. Still, more meaningful progress for all patients cannot happen without drug companies first lowering their list prices."

Scott explains this is not novel. Drug companies set prices on their products and PBMs leverage competition to lower costs:

"This commitment from PBMs is not something new. This is how our companies work. Once a drug company sets a list price, PBMs negotiate with the drug company to get the net cost - the amount employers and plan sponsors pay for prescription drugs that they cover for the people on their health plans - as low as possible. Meanwhile, the drug companies' list price decisions are based on their profit incentives, spending needs, and other factors under their control."

Big drug companies must put patients over profits and substantially lower the price as a starting point for negotiations with PBMs to ensure access and affordability for health plan sponsors and the individuals and families who rely on them for health insurance. In other words, if a drug company doesn't also address the drug's net price, there will be little progress…

When one drug manufacturer lowers its prices, it must still compete with other GLP-1 manufacturers for formulary placements - competition is a good thing and applies downward pressure on drug companies to lower their prices to secure formulary placements."

He emphasizes that PBMs support lower drug prices - and it is the pharmaceutical industry that tries to keep prices high:

"By deflecting from their anti-competitive practices, like misusing the patent system to keep more affordable alternatives from coming to market, drug companies can charge whatever price they want on their products. When they lower the cost of their drugs - like some big drug companies did last year on high-priced insulin products - the PBM industry welcomed it … and then did its part to further expand access for diabetes patients in need of these products."

Scott also explains how PBMs are already working with health plan sponsors, who make final decisions on plan design, to balance access to these high-priced medications while supporting access for patients:

"Meanwhile, PBMs are using their specialized pharmacy benefit expertise to actively support employers that cover GLP-1s for people seeking to lose weight. While the coverage decision belongs to the employer and plan sponsor, PBMs of all shapes and sizes (and there are 70 PBMs competing for employers' business in this country) are offering them comprehensive programs to help the right patients gain access to these treatments, combined with services that will help maximize the chances of long-term treatment success."

The op-ed concludes with a clear question for GLP-1 manufacturers:

"To deliver lower prescription drug costs for patients, drug companies need to do their part and lower the list prices of the drugs they make. That has to be the first step. We applaud Sanders for recognizing that. Our industry stands ready to continue our work to negotiate for lower costs and greater access.

The question for drug companies is:Will you do your part and answer the call to lower list prices as a starting point for negotiation?"

Read the full op-ed from D.C. JournalHERE.

Learn how PBMs are supporting employers and health plans on their GLP-1 coverage journey HERE.

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PCMA is the national association representing America's pharmacy benefit companies. Pharmacy benefit companies are working every day to secure savings, enable better health outcomes, and support access to quality prescription drug coverage for more than 275 million patients.

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