President, Big Pharma, PBMs wrangle over high drug prices

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Wrangling over prescription drug prices continues in Washington.

On March 4, President Joe Biden convened a “White House Roundtable on Lowering Healthcare Costs and Bringing Transparency to Prescription Drug Middlemen,” a meeting with policy advisers and experts on high costs of pharmaceuticals.

The White House’s official summary said guests included Kentucky Gov. Andy Beshear, who explained efforts to save that state up to $300 million in pharmaceutical expenses.

Sandra Clarke, chief operating officer of Blue Shield of California, called for more transparency in pricing and said some dominant middlemen block lower-priced generic drugs and biosimilars from getting to patients.

Cost-Plus Drugs founders Mark Cuban and Dr. Alex Oshmyansky “discussed the importance of transparency and described ways in which some middlemen may markup drug prices and distort market competition,” according to the White House’s official summary.

Dr. Chichi Ilonzo Momah, CEO and founder of Springfield Pharmacy, and Dr. Dared Price, president of Price Pharmacies and co-owner of Oread Rx, explained how PBM business practices hurt pharmacies and take a toll on patient health.

The session included National Economic Adviser Lael Brainard, Domestic Policy Adviser Neer Tanden, Health and Human Services Secretary Xavier Becerra, and Federal Trade Commission Chair Lina Khan, according to the White House.

PBMs hit back

The Pharmaceutical Care Management Association (PCMA) this week published a statement saying listening only to people “with vocal anti-PBM agendas, will make for a biased and unproductive discussion.”

“The PBM market is diverse and competitive, giving employers and plan sponsors choice and flexibility in managing prescription drug costs,” the PCMA statement said. “Unfortunately, today’s event serves to promote only one model and one perspective. We share the Administration’s goal of lowering prescription drug costs and would welcome the opportunity to work together to make prescription drugs more affordable for patients and employers.”

PBMs are the entities that negotiate with Big Pharma to lower drug prices, saving patients and payers more than $1,000 a year, according to PCMA.

Drug makers counteroffer

This week the president also announced the latest step in new negotiations over the prices of 10 prescription drugs that cost millions to Medicare. Makers of the first 10 drugs will continue the talks because all submitted counteroffers to the U.S. Centers for Medicare & Medicaid Services.

“This is an important milestone in our fight to give seniors the best possible deal on their prescription drugs and in lowering health care costs for all families,” the president’s official statement said. “And it comes in the face of attacks from Big Pharma in the courts and from Republicans in Congress who continue to try to repeal the Inflation Reduction Act (IRA) which would keep seniors on Medicare from benefitting from these lower cost drugs.”

The president said more information would be part of his State of the Union address scheduled at 9 p.m. March 7.

Litigation over negotiation

The announcement about the negotiations followed a March 1 court ruling that tossed pharmaceutical maker AstraZeneca’s claim that the drug price talks are illegal.

The IRA Drug Price Negotiation Program “offers a powerful incentive – the opportunity to sell products to more than 49 million Medicare and Medicaid beneficiaries – to induce drug manufactures (sic) to participate in the program and negotiate with CMS maximum fair prices for selected drugs,” said the ruling by Colm F. Connolly, chief judge of the U.S. District Court for the District of Delaware. “That incentive is not, as AstraZeneca contends, ‘a gun to the head.’ It is a potential economic opportunity that AstraZeneca is free to accept or reject.”

Additional court postings are available through the Health Care Litigation Tracker of the O’Neill Institute of Georgetown University.