Drug Channels delivers timely analysis and provocative opinions from Adam J. Fein, Ph.D., the country's foremost expert on pharmaceutical economics and the drug distribution system. Drug Channels reaches an engaged, loyal and growing audience of nearly 100,000 subscribers and followers. Learn more...
Today’s guest post comes from Joshua Guinter, Vice President of Channel Strategy and Product Access at Cencora.
Josh discusses the importance of a customized channel strategy for manufacturers. He outlines four key considerations that will ensure a successful strategy.
It’s time for Drug Channels’ annual update on pricing at the largest pharmaceutical manufacturers.
This year’s review includes the following 10 companies: Bristol Myers Squibb, Eli Lilly and Company, Genentech, GlaxoSmithKline, Merck, Novo Nordisk, Sanofi, Takeda, Teva, and UCB. You can find links to each company’s data below.
These data remain inconvenient for drug pricing flat earthers (#DPFE):
When rebates and discounts were factored in, brand-name drug prices again declined—or grew slowly—in 2023. For the companies that experienced net price gains in their portfolios, net prices grew more slowly than—or only slightly faster than—the overall inflation rate.
Rebates and discounts reduced the selling prices of brand-name drugs at the biggest drugmakers to less than half of their list prices.
For the eight companies with multiple years of data, the gross-to-net difference in price changes remained sizable. See the second chart below.
As I noted last week, multiple forces are poised to pop the gross-to-net bubble for high-list/high-rebate products. Insulin has been the first to deflate—and the Humira biosimilar market may be next. Journey with me to Bikini Bottom as we delve into the murky waters of gross-to-net drug pricing at the biggest drugmakers.
Today’s guest post comes from Greg Skalicky, President, EVERSANA; Krista Pinto, President, Deployment Solutions, EVERSANA; and Faruk Abdullah, President, Professional Services & Chief Business Officer, EVERSANA
Greg, Krista, and Faruk explain how and why integrated delivery networks (IDNs) have become crucial stakeholders for drug commercialization. They outline a two-pronged strategy to help brand teams thrive in today’s IDN landscape.
PBMs’ negotiating leverage against pharmaceutical manufacturers has been a key factor inflating the gross-to-net bubble—the ever-growing dollar gap between sales at brand-name drugs’ list prices and their sales at net prices after rebates, discounts, and other reductions.
For 2023, DCI estimates that the total value of manufacturers’ gross-to-net reductions for all brand-name drugs was $334 billion. (As we describe below, our latest estimates make a crucial change in the presentation of these figures compared with previous editions.)
Multiple forces are poised to pop the gross-to-net bubble for high-list/high-rebate products. This will force PBMs to further evolve their business models, while challenging plan sponsors and the FTC to follow the dollars.
Alas, patients remain caught in the drug channel's murky waters. I still can’t predict when SpongeBob SquarePants departs from Drug Channels—although I wish him a happy 25th birthday!
Today’s guest post comes from Gavin Magaha, Senior Director of External Affairs and Policy at Kalderos.
Gavin discusses the three key reasons for duplicate discounts between the 340B Drug Pricing Program and the Medicaid Drug Rebate Program. He then explains Oregon’s novel approach to fixing the problem.
The econowonks at the Centers for Medicare & Medicaid Services (CMS) recently released the latest projections for U.S. spending on healthcare. (See links below.) These data provide the latest official look at how the Inflation Reduction Act (IRA) will affect U.S. healthcare spending.
As you will see below, CMS projects that outpatient prescription drugs dispensed by retail and mail pharmacies will remain a small share of total U.S. healthcare spending. The Inflation Reduction Act’s changes to the Medicare Part D program, along with coming demographic shifts, will have a significant impact on future spending by government programs and consumers.
Nonetheless, taxpayers—primarily via Medicare and Medicaid—will continue to dominate the employer-sponsored insurance market. Like it or not, vertically integrated insurers, PBMs, specialty pharmacies, and providers will continue to prosper.
Today’s guest post comes from Kristina Crockett, VP of Product Management at CoverMyMeds.
Kristina discusses challenges patients face accessing, affording, and adhering to prescribed medications. She goes on to describe how manufacturers can overcome these challenges to improve outcomes for both patients and brands.
Good news, everyone! We have secured four outstanding fireside chat participants for our inaugural Drug Channels Leadership Forum, which will be held next March in Miami.
I’ll be leading one-on-one conversations with each of these executives:
Steven H. Collis, Chairman, President, and CEO, Cencora, Inc.
Patrick Conway, MD, MSc, CEO, Optum Rx
Frank Cunningham, Group Vice President, Global Value and Access & Lilly Direct, Eli Lilly and Company
Tim Wentworth, CEO, Walgreens Boots Alliance, Inc.
Our fireside chats will illuminate crucial issues and key strategic concerns affecting the prescription drug market and the entire U.S. healthcare system.
The event will also include panel discussions covering a range of important topics. Participants in these panels will be announced this fall.
IMPORTANT: To maximize the value of networking and learning, the event will have a limited number of attendees. Click here to request an invitation.
It's Valentine’s Day—and commercial plan sponsors remain smitten with copay accumulators and maximizers.
Our latest update finds that as of late 2023, about half of commercial lives were in plans that utilize a copay accumulator and/or a maximizer. These programs’ growth continues to divert the value of a manufacturer’s copay support payments away from patients and toward plans and PBMs. Check out the data below.
Patient advocacy groups and some big legal wins are starting to reverse Cupid’s arrow. But given the money at stake, I suspect that plans will keep looking for love in all the wrong places.
Today, we examine how manufacturers’ specialty networks contribute to this concentration. In DCI’s exclusive analysis below, we show that specialty pharmacies affiliated with pharmacy benefit managers (PBMs) play an outsized role in manufacturer-designated dispensing networks.
A typical network contains about five specialty pharmacies—but one in three specialty products with a manufacturer-designated network contains only a single specialty pharmacy. In those exclusive networks, independent and smaller specialty pharmacies are the big winners.
Read on for DCI’s updated profile of specialty networks—and ponder why smaller pharmacies are winning the battle for exclusive networks.
