when I first started working in a pharmacy – the summer of 1967 – there was no DEA, there were no PBM’s. Nearly all the Rx meds were brand name and everyone pay CASH for their prescriptions. The average Rx price was in the $4.00 range. Of course, the Brand Name Pharmas did all the R&D on new meds – as they do today. Generic companies do little/no R&D for new medications. If one took the average Rx price back in 1967 and apply the Consumer Price Index and/or Cost of Living Adjustment to that price. All things remaining the same, the average Rx price today should be in the $30 range – instead of pushing $70 as they are today, with 85%-90% of all Rxs being generics.
If somebody has taken the time, I have not seen it published. The two biggest changes in prescription market between 1967 and today is that today the PBM industry controls abt 90% of the pricing of all prescriptions and – to a certain degree – what medications the pt gets their insurance to pay for and the 85%-90% of all Rxs dispensed is now generics. I would suspect that one would find that the increase of the average Rx price would track the increase in the per-cent of all prescriptions that the PBM industry paid for over that time frame.
So, how does the part of the pharma industry in charge of footing the bill for all the R&D of new meds pay for all that expense when their meds are only 10%-15% of all prescriptions ? Charge a ARM & a LEG for a brand name med, don’t forget the PBM’s will demand up to 75% of the AWP (Average Wholesale Price) as a discount, rebate and/or kickback from the Pharma. The graphic below, demonstrates in what pockets the $$ you pay for your Rx really goes.
One pt I saw posted the other day on FB, that they called customer service for goodrx and they answered OptumRx customer service – part of United Health insurance. Yep, it appears that the 4-5 major PBM’s are behind those CASH DISCOUNT Rx CARDS.
Critics say Mark Cuban’s pharmacy isn’t tackling the big issue: brand-name drugs
Mark Cuban’s pharmacy, Cost Plus Drug Co., has hundreds of drugs marked at discounted prices, but some pharmacy experts say there’s a larger problem that needs fixing, CNBC reported July 28.
The online pharmacy launched in January with about 100 drugs, and by its one-year anniversary, plans to have more than 1,500 medications, according to the company’s website. The business model, which allocates for a $3 pharmacy dispensing fee, $5 shipping fee and a 15 percent profit margin with each order, aims to uproot the pharmaceutical industry, which has faced criticism for years about its opaque business practices.
Gabriel Levitt, the president of PharmacyChecker, a company that monitors the cheapest drug prices, told CNBC there’s more to be done.
“As much as I support the venture, what they’re doing does not address the big elephant in the room,” Mr. Levitt said. “It’s really brand-name drugs that are increasing in price every year and forcing millions of Americans to cut back on medications or not take them at all.”
Brand-name drugs are 80 percent to 85 percent more expensive than generics since brand-name drugs have to repeat clinical tests to prove efficacy, according to the FDA. Cost Plus Drug Co. only offers generics. Mr. Cuban told CNBC he hopes to sell brand-name medications “within six months,” but added that it’s a tentative timeline.
Filed under: General Problems
Leave a Reply