Radar on Drug Benefits

With a presidential election looming and the COVID-19 pandemic still raging, it might stand to reason that drug pricing reform efforts would be on the backburner. However, there are indications that policymakers remain focused on initiatives that could have tangible business impacts for insurers, PBMs and drug manufacturers. Furthermore, legal battles over those initiatives are continuing to play out — including one case slated for Supreme Court review in the fall.

That case, Rutledge v. Pharmaceutical Care Management Association, concerns PCMA’s challenge to a 2015 Arkansas law that requires PBMs to reimburse pharmacies at or above their wholesale cost for generic drugs (RDB 8/21/15, p. 7). The trade group argues that PBMs should be exempt from such regulation by states, as they act as agents under the Employee Retirement Income Security Act of 1974. After split decisions in the lower courts, the Supreme Court agreed to hear the case, which experts have told AIS Health has far-reaching consequences for state efforts to regulate PBMs. Hearings are now scheduled for October after being delayed due to the COVID-19 pandemic.

✦ A new report from UnitedHealth Group-owned OptumRx puts a spotlight on prescription prenatal vitamins — which the PBM counts among an “influx of clinically superfluous brand drugs that carry hefty price tags but offer little to no added clinical value.” According to OptumRx, some of the “worst offenders” include Solubiomix’s Azesco, Foxland Pharmaceuticals’ Trinaz, 7T Pharma’s Genicin Vita-S and TMIG Inc.’s Lorid, which have an average cost of $5,600 for a 90-day supply vs. $44 for a generic alternative covered by the PBM. Read more at https://bit.ly/31TWn6p.

✦ The Pharmaceutical Research and Manufacturers of America (PhRMA) on June 30 filed litigation challenging a Minnesota law that would allow diabetic patients to access an “urgent” 30-day supply of insulin for a copay of no more than $35. The law — HF 3100, also known as the Alec Smith Insulin Affordability Act — would also allow qualifying individuals to access a $50-or-less 90-day supply of insulin for up to a year. PhRMA argued that the law violates the fifth and 14th amendments of the U.S. Constitution, which “prohibits Minnesota from taking manufacturers’ private property for public use without just compensation.” Read PhRMA’s statement at https://onphr.ma/3gIQzAD.

A new proposed rule (85 Fed. Reg. 37286, June 19, 2020), which CMS touted as a way to tweak Medicaid’s best-price provision to encourage more value-based purchasing (VBP) for expensive drugs, has drawn considerable criticism from stakeholders across the health care system. Experts say the rule is much more complex than it was initially made to seem, and the 30-day comment period is unusually short for such a substantial change.

“Generally, stakeholders across the board have voiced concerns with the short comment period,” Lindsay Bealor Greenleaf tells AIS Health. Greenleaf is vice president for policy at ADVI Health LLC, a health care consultancy. “There are a lot of complex proposals included in this rule that take time to unpack, to really analyze.”

In what one expert calls a “logical” move for a PBM vying for business from cost-conscious payers, Anthem, Inc.’s IngenioRx said on July 6 that it acquired ZipDrug, a company that focuses on improving patients’ medication adherence and affordability.

“As plan sponsors and members opt in for the service, ZipDrug ensures members are matched with the best high-quality pharmacy to fulfill their needs,” Justin Petronzi, IngenioRx’s vice president of strategic growth, explains to AIS Health via email. Services offered by ZipDrug include “guaranteed prescription delivery, multi-dose compliance packaging that provides specific instructions to empower patients to manage their medications at home safely on a daily basis, along with other targeted clinical programs,” he says. ZipDrug can also help members find lower-cost alternatives to their medications to help ensure they’re affordable.