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 more than 40,000 subscribers. Learn more...

Monday, December 20, 2021

Drug Channels News Roundup, December 2021: CAR-T Profits, UM Boom, Health Plans vs. Experts, Confused Physicians, and Health Insurance Explained

Happy New Year, everyone! We made it through a challenging 2021. Ring in 2022 with these noisemakers from the Drug Channels party bag:
  • Hospitals earn incredible markups on CAR-T therapies
  • Utilization management booms
  • Health plans often ignore clinical guidelines
  • Benefit designs flummox physicians
Plus: an awesomely concise summary of U.S. health insurance.

P.S. Please join the more than 13,100 consumers of my daily commentary and links to neat stuff at @DrugChannels on Twitter. You can also find my daily posts on LinkedIn, where I have more than 22,000 followers.

Friday, December 17, 2021

How and Why I Was Overcharged by Penn Medicine and My Blue Cross Health Plan: A True Story (rerun)

This week, I’m rerunning some popular posts while I prepare for today's live video webinar: Drug Channels Outlook 2022. See you soon!

Click here to see the original post and comments from September 2021.


Sometimes, a little knowledge can be a bad thing.

I want to share with you, dear reader, the strange but true tale of my recent foray into the wonderful world of hospital price transparency for routine lab services.

I discovered—with great effort—that the rates my health plan negotiated with the largest local health system in Philadelphia were greater than the self-pay, cash price. Ultimately, my baffling and unexpected out-of-network bill required me to pay more out-of-pocket than the total cash price.

This tale neatly summarizes why so many people hate our healthcare system—and why the average patient will have trouble benefiting from transparency regulations.

Thursday, December 16, 2021

How CVS Health Drives Cardinal Health’s Distribution Financials (rerun)

This week, I’m rerunning some popular posts while I prepare for tomorrow's live video webinar: Drug Channels Outlook 2022. Hope you can join me!

Click here to see the original post and comments from September 2021.


Cardinal Health recently released the annual report for its 2021 fiscal year, which ended on June 30. See the links below.

Today, I delve into the financials behind Cardinal’s relationship with its largest customer, CVS Health. In Cardinal’s 2021 fiscal year, CVS purchased more than $42 billion in pharmaceuticals from the wholesaler—about double the figure from 10 years ago. The new report also reveals that CVS Health’s payment terms with Cardinal give the wholesaler an often-overlooked cash flow benefit.

I also compare Cardinal’s relationship with CVS to McKesson’s relationship with CVS. The two wholesalers sell more than $90 billion in pharmaceuticals to CVS Health—making it the largest U.S. drug purchaser.

Like McKesson, however, Cardinal Health has discovered that CVS is its worst best friend.

Wednesday, December 15, 2021

A Video History of Pharmacies and Prescription Prices: From Soda Fountains to GoodRx (rerun)

This week, I’m rerunning some popular posts while I prepare for this Friday’s live video webinar: Drug Channels Outlook 2022.

Click here to see the original post and comments from August 2021.


Charlotte Morabito at CNBC has put together “Why Pharmacies Overcharge,” an entertaining and provocative video on the pharmacy industry and its generic prescription pricing.

It’s definitely worth your time. I especially enjoyed the cool visualizations of Drug Channels Institute’s industry data. Links below.

The video covers the history of pharmacy, from the “Soda Fountain Era” to “Lick, Stick, and Pour” to the rise of PBMs and GoodRx. 

It also includes a wide variety of expert perspectives, including $0.02 from your friendly neighborhood blogger at Drug Channels. See the list below.

Grab some popcorn and enjoy the show!

Tuesday, December 14, 2021

PBMs and Drug Spending in 2020: Data from CVS Health (sort of), Express Scripts, Navitus, and WellDyne (rerun)

This week, I’m rerunning some popular posts while I prepare for this Friday’s live video webinar: Drug Channels Outlook 2022.

Click here to see the original post and comments from July 2021.


Since 2012, Drug Channels has examined commercial drug spending using the annual trend reports published by the largest PBMs.

This year, we review 2020 data on commercial plan sponsor clients of CVS Health and Express Scripts along with two smaller PBMs—Navitus and WellDyne. As you will see below, plan sponsors experienced another year of single-digit growth in overall pharmacy benefit drug spending.

For specialty drugs, utilization—more people taking more prescriptions—remained the driving force behind this higher spending. Specialty drug costs grew slowly—or even declined.

I’m sad to report that this year’s analysis is skimpier than usual. CVS Health has published only a bare bones summary, while Prime Therapeutics, MedImpact, and other large PBMs have stopped publishing trend reports. I document this disappointing state of affairs below.

Read on as I spread all the the k-poppin' details.

Monday, December 13, 2021

Why GoodRx—Not Amazon—May Be the True PBM Disrupter (rerun)

This week, I’m rerunning some popular posts while I prepare for this Friday’s live video webinar: Drug Channels Outlook 2022.

Click here to see the original post and comments from August 2021.


The generic prescription market is being disrupted—but not by the big, bad spaceman from Seattle.

Instead, consider how GoodRx is affecting patients, payers, and PBMs.

Below I summarize the latest financial results for GoodRx’s discount card business. We estimate that the company accounted for $4.1 billion in U.S. prescription revenues for 2021. That’s about six times its 2016 figure.

GoodRx and its discount card competitors profit by incentivizing people to bypass their own insurance plans. Meanwhile, our crazy pharmacy pricing system deters pharmacies from pursuing consumer-driven pricing and PBMs from undercutting their own clients.

Consequently, discount cards could become the force that upends PBMs’ pharmacy benefit economics, plan sponsors’ decisions, and the entire generic market. Should PBMs continue to profit from discount cards’ rapid growth…while ignoring the risk that this growth could undermine the value of their benefit management services?

Read on and see what you think.

Tuesday, December 07, 2021

Employer Pharmacy Benefits 2021: Patient Specialty Costs Rise with Coinsurance and Accumulators

It’s time for our annual deep dive into employer-sponsored coverage for prescription drugs.

For 2021, employers backed away slightly from high-deductible health plans. However, their pharmacy benefit designs increased the use of coinsurance for specialty and fourth-tier drugs. These designs have significantly raised patients’ out-of-pocket obligations and are likely to have reduced adherence.

Manufacturers’ patient support funds help offset patients’ higher expenses. But employer plans are rapidly adopting copay accumulators, which allow payers and PBMs to absorb these funds.

Read on for my overview of cost sharing tier structure, copayment vs. coinsurance, out-of-pocket obligations, and accumulators—presented with this year’s dose of horrible Drug Channels tiers/tears puns.

Please join me for my upcoming live video webinar, Drug Channels Outlook 2022, on December 17, 2021, from 12:00 p.m. to 1:30 p.m. ET. Hundreds of people from your competitors, customers, and suppliers have already signed up. Will you be there, too?

Monday, December 06, 2021

Better Data, Better Outcomes: A LexisNexis® Risk Solutions and Q1 Productions Webinar

Better Data, Better Outcomes: A LexisNexis® Risk Solutions and Q1 Productions Webinar
December 14, 2021
1:00 pm ET

This webinar is scheduled for a 45 minute presentation followed by 10 to 15 minutes of Q&A.


Your business depends on the data collected everyday across healthcare. That data not only drives the validation of the products and services your company offers today, but it also generates opportunities for new products and services. There are many data vendors that can supply the claims information from the day-to-day patient experience. But, how many vendors can target exactly the data you need and alert you in near real-time when those events occur? Moreover, how many data vendors can also provide you the opportunity to choose only the data points you need to inform your strategy tomorrow?

Join LexisNexis Risk Solutions and Q1 Productions for a webinar that will:
  • Highlight how MarketView™ from LexisNexis Risk Solutions can provide the data you need and alert you when new data is available
  • Uncover opportunities to access the specific data your business needs without having to filter through unnecessary data points
  • Illustrate how life science companies can improve patient outcomes by analyzing population health data and analytics to intervene proactively rather than reactively
With access to the data you need in near real-time, life science companies have the unique opportunity to better plan, impact, and support both healthcare providers and the patients they serve. Join us and learn how adding customized data and alerting can drive opportunities for enhancing your research, real-world data, precision medicine, and more.

Register here for the LexisNexis Risk Solutions and Q1 Productions Webinar: Better Data, Better Outcomes: Enhance the Patient Experience With Unique Data Solutions.


The content of Sponsored Posts does not necessarily reflect the views of Pembroke Consulting, Inc., Drug Channels, or any of its employees. To find out how you can promote an event on Drug Channels, please contact Paula Fein (paula@DrugChannels.net)..

Friday, December 03, 2021

Drug Channels Recommends: “Uncontrolled Spread” by Scott Gottlieb

Looking for a thoughtful and timely stocking stuffer?

I suggest Uncontrolled Spread: Why COVID-19 Crushed Us and How We Can Defeat the Next Pandemic, by Scott Gottlieb, M.D. (Amazon link)

This book provides a comprehensive, well-written chronicle of the COVID-19 pandemic (as of mid-2021). Dr. Gottlieb documents—with great specificity—how and why our government’s public health infrastructure failed us during the pandemic. He also offers valuable recommendations for better planning.

Read on for my review of this fascinating and important book, along with notable highlights from the text.

Please join me for my upcoming live video webinar, Drug Channels Outlook 2022, on December 17, 2021, from 12:00 p.m. to 1:30 p.m. ET. Click here to learn more and register for this event.

Wednesday, December 01, 2021

CVS Pharmacy Downsizes: 10 Industry Trends Driving the Retail Shakeout

ICYMI, CVS Health recently announced that it will close about 900 of its retail pharmacies. This downsizing complements the company’s shift toward its healthcare delivery future.

This long-overdue move highlights the retail industry’s fundamental economic headwinds. The pharmacy shakeout is accelerating, as smaller competitors exit and larger companies reduce store count.

To help you make sense of CVS’s move, below I outline 10 crucial forces of change reshaping the retail pharmacy industry.

For more on pharmacy’s future, please register for Drug Channels Outlook 2022, my live video webinar that will air on December 17, 2021.