Questions Surround The Role Of Pharmacy Benefit Managers In Driving Drug Prices

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Among the credit cards and store membership cards you have in your wallet, you might have a card from a pharmacy benefit manager. But if you're like lots of us, you don't know exactly what that card or the company behind it does.

Pharmacy benefit managers (or PBMs), such as Optum, Express Scripts and CVS Caremark, are supposed to negotiate the best drug prices for us.

But a recent report from the Massachusetts Health Policy Commission raises concerns that PBMs may be driving up costs associated with prescription medicines.

The director of the commission, David Seltz, spoke with WBUR's All Things Considered host Lisa Mullins about why the state wants more transparency around what pharmacy benefit managers do.

"What we've discovered is that the introduction of these new middlemen in the chain adds more costs to the system, [and] can actually increase the price of the drugs when they get to [a] retail pharmacy," Seltz said. "And it is not entirely clear what exactly the benefit and value that they're providing [is] in terms of keeping overall costs down."

A representative of the trade association of pharmacy benefit managers takes issue with the analysis done by Massachusetts.

"The report only looks at one quarter of data and only on some subset of drugs," said April Alexander, vice president of state, legislative and regulatory affairs for the Pharmaceutical Care Management Association. "Drug prices fluctuate over time, and reimbursements do, as well. So it's difficult to take just, like, a snapshot and ... make broad statements about the program in general."

According to Alexander, looking at the industry as a whole, health plans that contract with pharmacy benefit managers see a 30% cost savings over those that don't.

A spokesman for the pharmacy benefit manager Express Scripts tells us the company a few years ago negotiated down the very expensive price for a new treatment for Hepatitis C by about 50%.

Click the audio player next to this story's headline for the full interview with Seltz.

This segment aired on June 28, 2019.


Headshot of Lisa Mullins

Lisa Mullins Host, All Things Considered
Lisa Mullins is the voice of WBUR’s All Things Considered. She anchors the program, conducts interviews and reports from the field.


Headshot of Lynn Jolicoeur

Lynn Jolicoeur Producer/Reporter
Lynn Jolicoeur is the field producer for WBUR's All Things Considered. She also reports for the station's various local news broadcasts.



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