Drug companies set prices unrelated to rebates, according to PBM industry group study

PCMA published its research in its “Increasing Prices Set by Drugmakers Not Correlated With Rebates” report. | File photo

As a Senate committee prepares to evaluate U.S. drug distribution at a hearing tomorrow, the Pharmaceutical Care Management Association (PCMA) released a report demonstrating that manufacturers’ pricing does not correlate with agreed-upon rebates and discounts with pharmacy benefit managers (PBMs).

The report, “Increasing Prices Set by Drugmakers Not Correlated With Rebates,” was conducted by Visante for PCMA. It shows that drug prices have increased — based on manufacturers’ decisions — even when rebates are minimal or absent.

“This study definitively shows that drugmakers set and raise prices unrelated to the rebates they negotiate with PBMs,” PCMA President and CEO Mark Merritt said. “In fact, many high-priced drugs … involved no rebates until other competitors came to market.”

The report shows specific cases of high pricing for medications targeting such health issues as rheumatoid arthritis and convulsions. The study also revealed that certain introductory drug prices doubled between 2012 and 2016 from their previous figures, regardless of rebates.

Generally, PBMs contract with health care plans to minimize costs by promoting generics and by using rebates or other discount methods. PBMs pass savings first acquired directly from manufacturers to the health care plans, which in turn apply them toward reduced premiums, co-pays or similar consumer costs.

The Committee on Health, Education, Labor and Pensions, slated to run tomorrow’s hearing, is chaired by Sen. Lamar Alexander (R-TN).

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Pharmaceutical Care Management Association 325 7th St NW Washington, DC - 20004