Alternative PBM Satisfaction Declined in 2026, Shrinking the Advantage Over the Big Three PBMs

By Bryce Platt, PharmD

PBMs outside the Big Three still earn higher customer satisfaction ratings, but their lead has nearly disappeared.

Meanwhile, plan sponsors are inviting alternatives into their RFPs, and some are changing vendors. Research on 2027 benefits planning suggests the shopping will continue.

That combination points to a new test for alternative PBMs—one where they have to turn their pitch into value that plan sponsors continue to see after they sign a contract.

Below we examine the shrinking satisfaction advantage, the choices plan sponsors are considering for 2027, and why the grass may not always be greener on the alternative PBM side.

Drug Channels Leadership Forum 2027

The Drug Channels Leadership Forum agenda is now available! Explore the agenda and request your invitation to this invite-only gathering of senior leaders from across the drug channel ecosystem. You must request an invitation to be considered for attendance.

Drug Channels News Roundup, August 2026: 340B Rebate Model v2, Patients Feeling Drug Costs, Specialty Drug Spending Drivers, Impact on Coverage from the IRA, and a Drug Price Adventure

By Bryce Platt, PharmD

Kids are heading back to school, but the drug channel never stops handing out homework. Fortunately, we did some of the research prep for you.

In this issue:

• HRSA's Revised 340B Rebate Model Pilot

• Households Feel the Cost of Prescription Drugs More

• The Drivers of Specialty Drug Spending

• Lost Brand Coverage in Medicare Part D Plans After the IRA

Extra: Let’s Go on an Adventure to Find Out What Your Prescription Actually Costs You!

P.S. Join my nearly 42,000 LinkedIn followers for valuable daily posts at 9 a.m. ET.

Who Will Pay for Prescription Drugs in 2034? Medicare's Surprising Rise in the Latest Government Forecasts

By Adam J. Fein, Ph.D. and Greis Kapexhiu

In late June, the boffins at the Centers for Medicare & Medicaid Services (CMS) released the latest projections for U.S. spending on healthcare. (See links below.) These data provide the latest official, nonpartisan look at the future of U.S. healthcare spending.

Notably, overall U.S. spending on drugs dispensed by retail and mail pharmacies will remain about 9% of overall healthcare spending.

However, the new forecasts reflect the reality that the Congressional Budget Office (CBO) finally acknowledged last week: The Inflation Reduction Act’s (IRA) Part D provisions will cost much more than CBO had initially estimated.

Below, we outline the factors that led to the dramatic revision to Medicare spending, along with insights on the shrinking role of private insurance and consumer out-of-pocket spending.

Taxpayers—primarily via Medicare and Medicaid—now account for a majority of U.S. prescription drug spending, outstripping the share financed via employer-sponsored insurance.

Like it or not, everyone in the drug channel should prepare to deal with the government programs as increasingly important transaction partners—along with the biggest vertically integrated insurers, PBMs, specialty pharmacies, and healthcare services that administer these programs.

Minnesota’s 340B Hospitals Make One Billion More From 340B Than They Spend on Uncompensated Care (rerun)

This week, we’re rerunning some popular posts while we prepare for today’s live video webinar: 340B in 2026: Market Shifts, Policy Battles, and What They Mean for Stakeholders.

Click here to see the original post from April 2026.

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By Bryce Platt, PharmD

Minnesota’s new 340B data reveal a growing disconnect between the program’s size and the value Minnesotans receive in return.

In 2024, nonprofit hospitals generated more than $1.3 billion in 340B net profits—nearly a billion dollars more than they provided in uncompensated care. At the same time, these same institutions already benefit from substantial tax exemptions tied to their not-for-profit status and charitable mission.

The gap between 340B profits and charity care isn’t a rounding error or a one-off anomaly. The 340B Drug Pricing Program has evolved into a significant profit center for hospital systems. This is another layer on top of existing public subsidies, not a substitute for them.

As you’ll see below, our analysis describes a 340B program that generates financial gains far in excess of any contribution back to the people of the state. There is also no clear accountability for how those dollars are used.

Drug Channels News Roundup, April 2026: PBM Specialty Pharmacy Steering, MLR Profit Shifting, Hospitals’ Fake Prices, and a Peek Behind the Scenes at DCI

By Adam J. Fein, Ph.D.

Spring has officially arrived at Drug Channels' worldwide headquarters in beautiful downtown Philadelphia. (Photo proof at right.) So, dive into this month’s curated crop of noteworthy news:

• The patient experience at PBM-affiliated specialty pharmacies

• New evidence of profit shifting in vertically integrated Part D businesses

• The growing gap between non-profit hospitals’ public mission and financial reality

Plus: Behind-the-scenes at DCI

P.S. Join my nearly 70,000 LinkedIn followers for links to neat stuff, along with unfiltered commentary from the DCI community.

Minnesota’s 340B Hospitals Make One Billion More From 340B Than They Spend on Uncompensated Care

By Bryce Platt, PharmD

Minnesota’s new 340B data reveal a growing disconnect between the program’s size and the value Minnesotans receive in return.

In 2024, nonprofit hospitals generated more than $1.3 billion in 340B net profits—nearly a billion dollars more than they provided in uncompensated care. At the same time, these same institutions already benefit from substantial tax exemptions tied to their not-for-profit status and charitable mission.

The gap between 340B profits and charity care isn’t a rounding error or a one-off anomaly. The 340B Drug Pricing Program has evolved into a significant profit center for hospital systems. This is another layer on top of existing public subsidies, not a substitute for them.

As you’ll see below, our analysis describes a 340B program that generates financial gains far in excess of any contribution back to the people of the state. There is also no clear accountability for how those dollars are used.

List Price Reductions Will Deflate the Gross-to-Net Bubble–and Threaten Pharmacy and 340B Profits from IRA-Negotiated Drugs (rerun)

This week, I’m rerunning some popular posts while we prepare for Friday’s live video webinar: PBM Industry Update 2026: Trends, Challenges, and What’s Ahead.

Since this article was published last December, Net Pricing Drug Channel developments have accelerated. Manufacturers reduced the list prices for 6 of the 10 products with an MFP for 2026. They have also preemptively reduced list prices for three products that will have MFPs in 2027 and 2028. For more on these trends, see Section 12.1.1. of our new 2026 Economic Report on U.S. Pharmacies and Pharmacy Benefit Managers.

Click here to see the original post from December 2025.

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Contrary to popular belief, the Inflation Reduction Act’s (IRA) maximum fair prices (MFPs) could temporarily boost profits for retail pharmacies serving Medicare Part D patients.

The bad news? The IRA is also one of the five key forces deflating the gross-to-net bubble.

That’s why any IRA-related pharmacy profits will vanish if manufacturers lower list prices to be closer to net prices. At least 13 brand-name drugs—five of which have MFPs—reportedly plan to reduce list prices within the next two months.

As I show below, retail pharmacies risk becoming collateral damage from significant deflation in the gross-to-net bubble for drugs subject to an MFP. Welcome to our bonkers healthcare system—where everyone wants lower prices, until they actually get them.

What’s more, list price cuts will reduce profits from 340B contract pharmacy operations, while weakening covered entities’ main objections to a 340B rebate model. Get ready for a 340B slowdown.

Latest CMS Data Reveal Six Trends Reshaping U.S. Drug Spending

By Adam J. Fein, Ph.D.

The boffins at the Centers for Medicare & Medicaid Services (CMS) recently dropped the latest National Health Expenditure (NHE) data, which track all U.S. spending on healthcare. (Links below.)

We spent an astounding $5,278,588,000,000 on healthcare in 2024. Yes, that’s $5.3 trillion!

Retail outpatient prescription drugs accounted for less than 9% of that total. More than half of net outpatient drug spending was paid by federal, state, and local government programs. Below, we delve into the spending trends, which reveal the impact of the Inflation Reduction Act (IRA) on Medicare spending, the boom in healthcare marketplaces, and the post-pandemic bust in Medicaid.

Contrary to what you might read, the government’s data show that drug spending growth was not driven by purportedly “skyrocketing” drug prices. In reality, nearly all of the increase in drug spending reflected higher utilization—more people treated, more prescriptions dispensed, and shifts among drugs dispensed—rather than higher net prices.

Prices may grab headlines, but utilization—and taxpayers—are driving the spending story. When prices stop being signals, markets stop being markets.

U.S. Brand-Name Drug Prices Fell in 2025 as the Net Pricing Drug Channel Emerges

By Adam J. Fein, Ph.D.

It's time for Drug Channels’ annual examination of U.S. brand-name drug pricing.

For 2025, brand-name drugs’ average list prices grew by only 3.5%, but net prices declined. When manufacturers’ rebates and discounts are factored in, drugs’ average net prices—both before and after inflation—fell. Details and additional commentary below.

As I have been predicting, the gross-to-net bubble is deflating due to the combined impacts of government actions and consumer behavior.

For 2024 and 2025, manufacturers reduced the wholesale acquisition cost (WAC) list prices for more than 20 brand-name drugs. For 2026, manufacturers will cut prices on at least 15 more drugs, which will reduce gross brand-name revenues by $35 to $40 billion. List prices are dropping by –25% to –85%.

The data leave no doubt: the bubble is finally leaking air. We are entering the Net Pricing Drug Channel (#NPDC)—a market environment in which net prices, not list prices, drive access, economics, and strategy.

The NPDC will reward simplicity, punish rebate dependence, and force every channel participant to rethink how money actually moves. Time to get ready.

Who Will Pay for Prescription Drugs in 2033: DCI’s Takeaways from the Latest Government Forecasts (rerun)

This week, I’m rerunning some popular posts while I prepare for Friday's live video webinar: Drug Channels Outlook 2026 .

Click here to see the original post from September 2025.

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Over the summer, the boffins at the Centers for Medicare & Medicaid Services (CMS) released the latest projections for U.S. spending on healthcare. (See links below.) These data provide the latest official and apolitical look at the future of U.S. healthcare spending.

The top line projections highlight the government’s official view that prescription drugs dispensed by retail and mail pharmacies will have a modest impact on U.S. healthcare costs.

However, there are some notable changes from the previous forecast. CMS now expects that the Inflation Reduction Act’s changes to the Medicare Part D program will have a greater impact than previously projected, while private insurers will find drug costs creeping higher.

Below, we outline the four major takeaways from the latest projections, which continue to show that taxpayers—primarily via Medicare and Medicaid—will continue to dominate the employer-sponsored insurance market. And like it or not, vertically integrated insurers, PBMs, specialty pharmacies, and providers will continue to prosper.

List Price Reductions Will Deflate the Gross-to-Net Bubble–and Threaten Pharmacy and 340B Profits from IRA-Negotiated Drugs

By Adam J. Fein, Ph.D.

Contrary to popular belief, the Inflation Reduction Act’s (IRA) maximum fair prices (MFPs) could temporarily boost profits for retail pharmacies serving Medicare Part D patients.

The bad news? The IRA is also one of the five key forces deflating the gross-to-net bubble.

That’s why any IRA-related pharmacy profits will vanish if manufacturers lower list prices to be closer to net prices. At least 13 brand-name drugs—five of which have MFPs—reportedly plan to reduce list prices within the next two months.

As I show below, retail pharmacies risk becoming collateral damage from significant deflation in the gross-to-net bubble for drugs subject to an MFP. Welcome to our bonkers healthcare system—where everyone wants lower prices, until they actually get them.

What’s more, list price cuts will reduce profits from 340B contract pharmacy operations, while weakening covered entities’ main objections to a 340B rebate model. Get ready for a 340B slowdown.

For more on the intended and unintended consequences of the IRA—and its interplay with 340B—join me for my live video webinar, Drug Channels Outlook 2026, on December 12, 2025, from 12:00 p.m. to 1:30 p.m. ET.

Cigna’s Rebate-Free Pharmacy Model: Three Realities Behind Its Latest Push to Pop the Gross-to-Net Bubble

By Adam J. Fein, Ph.D.

On Monday, Cigna announced that it would be abandoning traditional manufacturer rebates and moving to a new, “rebate-free” approach—essentially a point-of-sale (POS) rebate model paired with a cost-plus pharmacy reimbursement framework. Here’s the press release.

Moving manufacturers’ rebates and discounts to the point of dispensing is a big win for patients, who can share in the savings that pharmacy benefit managers (PBMs) negotiate with drugmakers. It's a practical, patient-friendly step toward shrinking the gross-to-net bubble that has inflated out-of-pocket costs for years.

Yet as always, the fine print matters. Below are three crucial considerations that reveal why this move might be less revolutionary than it first appears—and why it may not be widely adopted by plan sponsors. Perhaps these will spark some questions for Cigna's management about the company's increasingly opaque profit model during tomorrow’s third-quarter earning call.

This isn’t the first time that Express Scripts has tried to alter how its plan sponsors manage their pharmacy benefits. After reading the analysis below, you can decide whether this latest attempt is true reform—or the triumph of hope over experience.

2024 Gross-to-Net Realities at 9 Top Drugmakers: A New Era of Market Access (rerun)

This week, I’m rerunning some popular posts while I put the finishing touches on DCI’s 2025-26 Economic Report on Pharmaceutical Wholesalers and Specialty Distributors.

Click here to see the original post from July 2025.

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It’s time for Drug Channels’ annual update on drug pricing trends at the largest pharmaceutical manufacturers.

This year’s review includes the following nine companies: Bristol Myers Squibb, Eli Lilly and Company, Genentech, GlaxoSmithKline, Johnson & Johnson, Sanofi, Takeda, Teva, and UCB. You can find links to each company’s data below.

These data highlight divergent trends reshaping the gross-to-net bubble:

• Rebates, discounts, and other fees reduced the selling prices of brand-name drugs at the biggest drugmakers to less than half of their list prices.

• When accounting for all list price reductions, average brand-name drug prices declined at three manufacturers and increased at six others.

• Gross-to-net difference in price changes ranged from −12.8% to +6.3%, reflecting significant differences in the manufacturers’ portfolio mix and pricing strategies.

As I noted in last week’s gross-to-net bubble analysis, manufacturers’ evolving market access strategies increasingly aim to offset—or circumvent—growing pricing pressure from both commercial and government payers. Drug pricing flat earthers (#DPFE) will be challenged by falling net prices, while policy wonks will be amazed at the unintended consequences unleashed by our crazy system.

So, journey with me to Bikini Bottom as we again delve into the murky waters of gross-to-net drug pricing. Click here to share your thoughts with the Drug Channels community.

Who Will Pay for Prescription Drugs in 2033: DCI’s Takeaways from the Latest Government Forecasts

Over the summer, the boffins at the Centers for Medicare & Medicaid Services (CMS) released the latest projections for U.S. spending on healthcare. (See links below.) These data provide the latest official and apolitical look at the future of U.S. healthcare spending.

The top line projections highlight the government’s official view that prescription drugs dispensed by retail and mail pharmacies will have a modest impact on U.S. healthcare costs.

However, there are some notable changes from the previous forecast. CMS now expects that the Inflation Reduction Act’s changes to the Medicare Part D program will have a greater impact than previously projected, while private insurers will find drug costs creeping higher.

Below, we outline the four major takeaways from the latest projections, which continue to show that taxpayers—primarily via Medicare and Medicaid—will continue to dominate the employer-sponsored insurance market. And like it or not, vertically integrated insurers, PBMs, specialty pharmacies, and providers will continue to prosper.

2024 Gross-to-Net Realities at 9 Top Drugmakers: A New Era of Market Access

It’s time for Drug Channels’ annual update on drug pricing trends at the largest pharmaceutical manufacturers.

This year’s review includes the following nine companies: Bristol Myers Squibb, Eli Lilly and Company, Genentech, GlaxoSmithKline, Johnson & Johnson, Sanofi, Takeda, Teva, and UCB. You can find links to each company’s data below.

These data highlight divergent trends reshaping the gross-to-net bubble:

• Rebates, discounts, and other fees reduced the selling prices of brand-name drugs at the biggest drugmakers to less than half of their list prices.

• When accounting for all list price reductions, average brand-name drug prices declined at three manufacturers and increased at six others.

• Gross-to-net difference in price changes ranged from −12.8% to +6.3%, reflecting significant differences in the manufacturers’ portfolio mix and pricing strategies.

As I noted in last week’s gross-to-net bubble analysis, manufacturers’ evolving market access strategies increasingly aim to offset—or circumvent—growing pricing pressure from both commercial and government payers. Drug pricing flat earthers (#DPFE) will be challenged by falling net prices, while policy wonks will be amazed at the unintended consequences unleashed by our crazy system.

So, journey with me to Bikini Bottom as we again delve into the murky waters of gross-to-net drug pricing. Click here to share your thoughts with the Drug Channels community.

Drug Channels News Roundup, May 2025: MFN Controversy, Plan Sponsors ♥️ Rebates, PBM Profits, and Fun in Congress

Summer unofficially began over the weekend. To mark the occasion, here are a few hot items, freshly seared on the Drug Channels grill:

• Reactions from the Drug Channels community to the Most Favored Nation (MFN) pricing policy

• A reality check on whether plan sponsors truly want rebate reform

• What plan sponsors should know about the evolving profit models of pharmacy benefit managers (PBMs)

Plus: A special moment for DCI on Capitol Hill.

P.S. Join my 63,000+ LinkedIn followers for daily links to neat stuff, along with sharp and thoughtful commentary from the DCI community.

What’s Next for Retail Pharmacy: Data, Debate, and Disruption.

Don’t miss DCI’s June 20, 2025, webinar, featuring Dr. Adam J. Fein and Antonio Ciaccia. We’ll unpack the good, the bad, and the ugly of the pharmacy industry—and explore what it means for you. This dynamic session will blend expert insights and real-time debate. Join us!

Inflation-Adjusted U.S. Brand-Name Drug Prices Fell for the Seventh Consecutive Year as a New Era of Drug Pricing Dawns (rerun)

This week, I’m rerunning some popular posts while I prepare for today’s live video webinar: PBM Industry Update: Trends, Challenges, and What’s Ahead.

Click here to see the original post from January 2025.

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It's time for Drug Channels’ annual examination of U.S. brand-name drug pricing.

For 2024, average brand-name drugs’ list prices grew by only 2.3%. What’s more, after adjusting for overall inflation, brand-name drug net prices dropped for an unprecedented seventh consecutive year. Details and additional commentary below.

As I predicted two years ago, the combined impact of changes to Medicaid rebates, the Inflation Reduction Act (IRA), and novel formulary access strategies have led multiple manufacturers to pop the gross-to-net bubble for high-list/high-rebate products. Consider the 18 products with list-price cuts shown below.  Other drugmakers have reduced the rate of price increases, thereby inflating the bubble more slowly.

Employers, health plans, and pharmacy benefit managers (PBMs) determine the extent to which patients with insurance share in this ongoing deflation. But signs of change to the conventional approaches are undeniable.

New channel models—including smaller PBMs, cost-plus pharmacies, patient-paid discount card prescriptions, and manufacturers’ direct-to-patient businesses—are creating novel paths for drugs that can be sold without gross-to-net bubble distortions.

The bubble won’t vanish overnight. But for the first time in years, I can foresee a time when SpongeBob SquarePants will move on from Drug Channels.

Drug Channels News Roundup, January 2025: Mark Cuban Fixes Healthcare, Payers’ G2N Bubble, Pharmacists Rejoice, 340B Shenanigans, and 46Brooklyn vs. Mushrooms

Get ready to climb a Crisco-covered light pole! DCI’s hometown Philadelphia Eagles are going to Super Bowl LIX! Go E-L-G-S-E-S! (No, that's not a typo.)

Before you overturn any cars, please enjoy this month’s playbook of articles, intercepted for you from the Drug Channels gridiron:

• Touchdown! How Mark Cuban would quarterback the U.S. healthcare system 

• Trick Play: Patients and plans get sacked by a gross spending-to-net bubble

• Defensive line: A comeback for pharmacy students

• Offensive line: Apexus dances in the end zone, while a 340B hospital tackles a patient

Plus, Super Antonio runs downfield in the Mushroom Kingdom.

P.S. I recently passed 60,000 LinkedIn followers. If you haven’t done so already, follow along for my daily links to neat stuff along with thoughtful and provocative commentary from the DCI community.

Inflation-Adjusted U.S. Brand-Name Drug Prices Fell for the Seventh Consecutive Year as a New Era of Drug Pricing Dawns

It's time for Drug Channels’ annual examination of U.S. brand-name drug pricing.

For 2024, average brand-name drugs’ list prices grew by only 2.3%. What’s more, after adjusting for overall inflation, brand-name drug net prices dropped for an unprecedented seventh consecutive year. Details and additional commentary below.

As I predicted two years ago, the combined impact of changes to Medicaid rebates, the Inflation Reduction Act (IRA), and novel formulary access strategies have led multiple manufacturers to pop the gross-to-net bubble for high-list/high-rebate products. Consider the 18 products with list-price cuts shown below.  Other drugmakers have reduced the rate of price increases, thereby inflating the bubble more slowly.

Employers, health plans, and pharmacy benefit managers (PBMs) determine the extent to which patients with insurance share in this ongoing deflation. But signs of change to the conventional approaches are undeniable.

New channel models—including smaller PBMs, cost-plus pharmacies, patient-paid discount card prescriptions, and manufacturers’ direct-to-patient businesses—are creating novel paths for drugs that can be sold without gross-to-net bubble distortions.

The bubble won’t vanish overnight. But for the first time in years, I can foresee a time when SpongeBob SquarePants will move on from Drug Channels.

Transparency Shocker: Biosimilars Are Getting Cheaper—But Hospitals and Insurers Can Make Them Expensive

Here on Drug Channels, we have long highlighted the boom in provider-administered biosimilars. In contrast to the pharmacy market, adoption of these biosimilars is growing, prices are dropping, and formulary barriers continue to fall.

Novel transparency information reveals that this good news doesn’t always translate into savings. Below, we rely on a unique data set from Turquoise Health to examine how much four national commercial health plans—Aetna, Anthem, Cigna, and UnitedHealthcare—paid hospitals for Avastin and its two most significant biosimilar competitors.

As we demonstrate, health plans pay hospitals far above acquisition costs for biosimilars. What’s more, plans can pay hospitals more for a biosimilar than for the higher-cost reference product. The U.S. drug channel system is warping hospitals’ incentives to adopt biosimilars, while simultaneously raising costs for commercial plans.

The namesake of my alma mater once said: “Sunlight is said to be the best of disinfectants.” What would happen if we disinfected the entire channel?