Retail pharmacies find allies in PBM clash

Published 11:59 pm Friday, February 19, 2010

Community Editor

Editor’s note: This is the final installment in a two-part series about pharmacy benefit management companies (PBMs) and their effects on retail pharmacies locally and nationwide.
Local retail pharmacies have found two key allies in their fight against pharmacy benefit managers.
U.S. Reps. G.K. Butterfield (D-NC) and Walter B. Jones Jr. (R-NC), each represents parts of Beaufort County, are cosponsoring the Patient Health &Real Medication Access Cost Savings Act.
The Pharmacy Bill, as it’s being called, was authored by Butterfield, then introduced to Congress on Dec. 3, 2009, to reduce patient dependence on pharmacy benefit management companies for medications. Butterfield spokesman Ken Willis said Butterfield wrote the bill in response to “concerns from local pharmacies.”
“They began to tell me story after story about consumers, and their families, being steered to purchase from large chains,” Butterfield said in a telephone interview.
The Pharmacy Bill aims to prevent such patient “steering,” in which PBMs force patients to get their medications through mail-only services or pharmacies owned by the PBMs, according to a news release from Butterfield’s office.
Area pharmacies have accused Medco Health Solutions Inc. of “steering.”
On Jan. 1, Medco, one of the nation’s largest PBMs, became PotashCorp’s primary health-care provider. With that move, PotashCorp employees company-wide will have to pay more out-of-pocket costs to purchase maintenance medications through retail pharmacies rather than Medco’s mail-order service, according to PotashCorp of Aurora spokeswoman Michelle Vaught.
“For local pharmacies, it doesn’t seem that the competition is even-handed,” Willis said.
The Pharmacy Bill also seeks to reduce drug costs by preventing “spread pricing,” in which PBMs purchase drugs and pay pharmacies at one price and then charge the government and insurers a higher price without disclosing the difference, according to the news release.
“PBMs have to become transparent,” Butterfield said. “We have reason to believe they’re making a windfall profit.
Butterfield said PBMs need to testify before Congress about the cost-savings and rebates they receive from drug manufacturers.
Mark Merritt, president and CEO of the Pharmaceutical Care Management Association, which represents the nation’s PBMs, said the association supports transparency.
“When an employer is looking at various PBMs, they can demand whatever information they want on the front end. Some employers want a whole lot (of information), some just want to save money,” he said.
Opponents of the Pharmacy Bill, including the PCMA, argue that the bill will drive up the cost of health care.
“At a time when all of Washington wants to reduce the cost of health care, the Butterfield legislation would destroy proven cost-containment tools that unions, large employers, and Medicare rely upon and drive premiums higher for working families, seniors, and the disabled,” according to a PCMA news release.
Merritt said the Pharmacy Bill targets the two most-effective tools for cutting health-care costs: mail-order prescriptions and generic drugs.
“The Butterfield legislation would prohibit unions and employers from creating benefit designs that encourage generic utilization and other cost savings tools (and) adds new barriers to prevent consumers from using more convenient options like home delivery,” the PCMA release states.
Merritt said he understands why the bill opposes mail-order services.
“Retailers would like to have more traffic in their stores,” he said. “But businesses ought to use whatever tools they can to reduce health-care costs. Employers shouldn’t have to pay more for health care simply because retail drug stores have to make more money.”
Butterfield said people, not businesses, have the right to choose a mail-order prescription service or retail pharmacy.
As part of his campaign for the Pharmacy Bill, Butterfield shadowed a pharmacist at Wayne Pharmacy in Goldsboro on Thursday afternoon. He said customers in the drug store explained why they don’t want to be forced into using a mail-order service.
“They said they benefit in the comfort and security of their community pharmacy,” Butterfield said.
The congressman has also found support from his colleagues in the House. The Pharmacy Bill currently has 25 cosponsors, including Republican Howard Coble and Democrats Bob Etheridge, Larry Kissell, Mike McIntyre, Brad Miller and David Price, members of the state’s congressional delegation.
“I’m getting positive feedback,” Butterfield said.
Jones said he supports the bill “because it promises to improve competition and transparency in the prescription drug supply chain, increase the use of lower cost generic drugs and cut overall prescription drug costs.”
Merritt said the bill doesn’t make sense in the current economy.
“(Companies) need to consider what’s more affordable, not more expensive,” he said.