- Walgreens wants to sell its infusion business?!?
- New evidence that generic drug inflation is creating multiple generic tiers
- Texas Medicaid will base pharmacy reimbursement on acquisition costs
- Alliance Boots’ Stefano Pessina is not a fan of tobacco in pharmacies
Walgreen explores sale of $1.5 billion infusion business: sources
Reuters reported that Walgreens wants to sell a majority stake in its infusion services business. Walgreens built the business with its 2007 Option Care acquisition and a 2010 Omnicare deal. My $0.02: I don’t understand the strategic rationale for divesting out of a fast-growing channel for specialty drugs. Looks to me like Walgreens is backing away from a differentiated business, thereby further exposing the company to commoditized retail dispensing. For an alternative strategic approach, read my analysis of the 3 Reasons Why CVS Caremark Absorbed Coram.
Is All “Skin in the Game” Fair Game? The Problem With “Non-Preferred” Generic
This fascinating American Journal of Managed Care article describes how some insurers are splitting their all-generics tier into a bottom tier consisting of “preferred” generics, and a second tier consisting of “non-preferred” generics. The authors note: “We think it is apparent that designation of these generic drugs as ‘non-preferred’ was based on cost considerations alone; indeed, a number of insurers unabashedly refer to their second tiers as consisting of ‘higher-cost generic drugs.’” Unfortunately, this article confirms my belief that consumers are the real losers from generic drug inflation, per Winners and Losers from Generic Drug Inflation. L
Texas will move to NADAC-based reimbursement methodology
Here’s some more momentum for new pharmacy reimbursement models. At IIR’s recent Medicaid Drug Rebate Program (MDRP), Andy Vasquez, Deputy Director of Texas' Medicaid/CHIP Vendor Drug Program announced that that Texas will move to a NADAC-based reimbursement methodology. (NADAC = National Average Drug Acquisition Cost) As of 2013, six state Medicaid programs—Alabama, Colorado, Idaho, Iowa, Louisiana, and Oregon—were relying on their own acquisition cost surveys for pharmacy reimbursement. A 2011 OIG report found that 44 state programs had asked CMS to develop a single national benchmark to set Medicaid reimbursement rates. For more fun NADAC background and its implications for the pharmacy industry, see the sections starting on pages 86 and 136 of the 2013–14 Economic Report on Retail, Mail, and Specialty Pharmacies.
Boots will never sell cigarettes, vows boss
An eagle-eyed reader sent me this 2013 interview with Stenafo Pessina, the billionaire businessman and soon-to-be largest individual shareholder of Walgreens Boots Alliance, Inc. Per the article: "Absolutely not!" was Stefano Pessina's forceful response when asked whether customers would start seeing cigarettes sold behind the counter at Boots stores. Put that in your pipe and smoke it.
American Medical Association Introduces New Highly Effective Placebo Doctors
The Onion, America’s Finest News Source, reports on the American Medical Association’s introduction of new placebo doctors to administer general practice medical care to the American public. Physicians and other professional care account for more than 25% of U.S. health expenditures, so this move should help slow spending growth. Well done, AMA!