Radar on Drug Benefits

  • ICER Report on Eliquis, Xarelto May Aid Drug Price Negotiations

    The Institute for Clinical and Economic Review (ICER) published a report on Oct. 2 evaluating the blood thinners Eliquis (apixaban) and Xarelto (rivaroxaban), two of the 10 drugs that will be subject to Medicare price negotiations starting in 2026.

    Based on ICER’s modeling and review of the available evidence, the organization determined that Eliquis and Xarelto could have substantial price premiums over warfarin. However, when compared with dabigatran, ICER noted that Eliquis could have a smaller price premium and Xarelto could have no price premium. Warfarin and dabigatran are both generic drugs that are competitors to Eliquis and Xarelto.

  • Large-Employer Groups Dispute PCMA Claim That Some Firms Prefer Spread Pricing

    In a recent report, the Pharmaceutical Care Management Association (PCMA), the trade group representing the largest PBMs, claimed that employers often choose spread pricing when they set up their PBM contracts. But employer plan sponsor groups, which have pushed for years for a federal ban on spread pricing, tell AIS Health that the way PCMA describes employers’ pharmacy benefit options is misleading — instead, the plan sponsor groups say, PBMs manipulate employers into spread pricing arrangements.

    PBMs are under intense scrutiny in Congress: Legislators from both parties seem likely to pass more aggressive regulation of the industry this year. A ban on spread pricing is one of the key policies under consideration. Spread pricing is the business practice in which PBMs pay pharmacies dispensing a drug less than what they charge payers, with the PBM pocketing the difference. This can result in substantial revenue for the PBM, as the “spread” for the same pharmaceutical product can vary widely from pharmacy to pharmacy.

  • Stand-Alone PDP Market Is Poised for Disruption, Experts Predict

    The stand-alone Prescription Drug Plan (PDP) market — which was already in decline — is poised to take even more hits due to regulatory and legislative changes that are taking effect in 2024 and beyond, according to industry observers. Indeed, one expert who analyzed data from CMS’s 2024 Medicare Advantage and Part D “landscape files” predicts that “a lot of people are faced with pretty significant premium increases” next year.

    There’s a complicated calculus driving that trend, explains Tom Kornfield, a senior consultant at Avalere Health. But both he and equities analyst George Hill agree that the Inflation Reduction Act of 2022 (IRA) is a major factor.

  • Enrollees Will Face Fewer Medicare PDP Options, Higher Average Premiums in 2024

    During the 2024 Medicare Annual Election Period that starts on Oct. 15, a total of 708 stand-alone Prescription Drug Plans will be available for beneficiaries in 2024 nationwide, a 12% drop from 2023. Only 126 PDPs will be offered without a premium to enrollees receiving the Low-Income Subsidy (LIS) in 2024, compared with 191 PDPs in 2023.
  • News Briefs: Hawaii Sues Big PBMs

    The state of Hawaii on Oct. 4 in federal court sued the Big Three PBMs — CVS Health Corp.’s Caremark, UnitedHealth Group’s Optum Rx, and The Cigna Group’s Express Scripts. The suit accuses the firms of “siphon[ing] increasing amounts of money from the pharmaceutical supply chain while significantly increasing prices for consumers, employers, and other health care payers” through unfair trade practices. According to a press release from Hawaii Gov. Josh Green, M.D., and Attorney General Anne Lopez, both Democrats, the complaint accuses PBMs of “unfair methods of competition and unfair and deceptive acts and practices in violation of Hawaiʻi law,” such as inappropriate fees charged to manufacturers for formulary placement. The state will seek civil penalties of $10,000 per violation, with additional penalties sought for “each deceptive or unfair act that was directed towards an elder.”
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