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How Pharmacists Are Trapped in the Middle of Drug Price Wars

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Pharmacists, as the interface between the general public and prescription drug manufacturers, can sometimes feel as if they’re treading a fine line between fulfilling their obligations to pharmaceutical companies and benefits managers, and their obligations to their customers.

Pharmacists are the interface between customers and pharmacy benefit managers (PBMs).

On the one hand, they hear first-hand about patient dissatisfaction with drug prices. Customers aren’t likely to call up Pfizer or Lilly to complain, after all. On the other hand, pharmacists must uphold their agreements with pharmacy benefit managers (PBMs) or risk getting kicked out of lucrative pharmaceutical networks that may provide their bread-and-butter income. Ultimately, the issue comes down to generic drugs and what pharmacists are allowed to discuss with patients in terms of drug price.

Sometimes It’s Cheaper to Buy Prescriptions Without Insurance

With most prescription drug coverage, enrolled patients pay a flat fee for drugs included in a particular price tier. An established drug with many generic counterparts will typically have a low co-payment, while more experimental, newer, or more complex drug formulations will have much higher co-payments. It makes sense.

But what about when a generic is available that costs significantly less than what the pharmacy has agreed to charge under an agreement with a PBM? In other words, someone without prescription drug coverage may pay the $3 cash cost of the drug, while someone with prescription coverage would pay a $10 co-payment for the same drug.

Pharmacists Are Often Bound by Strict PBM Contracts

It sounds simple: the pharmacist could simply tell the customer to buy the generic outside their prescription drug coverage and save $7 in the above example. But in fact, it’s not simple. Many PBM contracts stipulate that pharmacists cannot tell customers that it would be cheaper to get a prescription without involving their insurance, and many pharmacists balk at this restriction.

No pharmacist wants to be kicked out of a PBM that brings them considerable business. But most pharmacists are the ones who literally see the effects of high drug prices on the surprised faces of their customers, and knowing there’s a way around it that they’re not allowed to talk about has them feeling trapped.

Many States Are Considering Legislation

Legislation restricting so-called PBM gag rules has gained traction in several states.

Several states have enacted legislation specifically concerning PGMs, and many of the new laws eliminate the so-called gag rule that restricts pharmacists from telling patients when they can buy outside their insurance plan and save money. Many more states, including New York and Washington State, have similar legislation pending. Some states, including California, however, have tried and failed to enact legislation to this end. The president has pledged to put an end to the gag clauses on the national level, but it has not happened yet.

Independent Pharmacies Bear the Brunt

It is the independent pharmacies that are feeling the most pressure in this situation. Many independent pharmacies stake a lot of their success on forming strong customer relationships and serving customers over a period of years or decades. They are the ones who have the most to lose by being kicked out of PBM networks, because the networks bring them so much business. At the same time, they balk at being unable to inform their long-time customers – particularly senior citizens – when their best price on prescription drugs can be had completely outside their coverage.

The general zeitgeist is toward allowing patients to make the most informed decision possible when it comes to using or not using their prescription drug benefits. With many states enacting legislation to prohibit PBM gag rules on pharmacists, and many others considering such legislation, it is a topic that PBMs will have to consider sooner or later.

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