The PBM Policy Forum and Why You Should Care
Pharmacy Benefit Managers – or PBMs – play a critical role in our healthcare and its cost. They are the organizations that determine (among other things) whether a medication is covered (at all), what tier of drug it is (thereby setting your copay amount), whether generics (and probably soon, biosimilars) are substituted, and whether or not you need to go through the hoops of step therapy (taking cheaper drugs before you get the one your doctor ordered). For example, if you’ve started or changed a biologic treatment, you probably got a letter in the mail from a PBM stating that it had been approved for a specific amount of time. Some of the large PBMs include CVSHealth, Prime Therapeutics, and OptumRX.
PBM Practices and Policy Meeting
I understand that the sheer number of prescriptions and magnitude of patients means that someone needs to be able to sort this out for our insurance carriers. But some of the practices of the PBMs have been challenged not only by patients but also by lawmakers. I’ve commented on some of these practices on my personal blog. When I learned of the 2018 Policy Forum, I decided I needed to personally hear what was being said. As one of the great privileges of writing for RheumatoidArthritis.net, they offer a limited “scholarship” to help their contributors attend conferences and other meetings to help ensure we are in tune with the latest information. Their generosity made it possible for me to attend.
To be clear, the policy meeting revolved around how federal and state government policies were going to affect the PBMs. In addition to speakers from the PBMs, benefit managers and specialty pharmacies, there were representatives from the federal and state government agencies including the FDA, Health and Human Services, the House Ways and Means Committee, and a panel of legislators from Florida, Texas and Wisconsin. No doubt the keynote speaker was Scott Gottlieb, Commissioner of Food and Drugs for the FDA. Unfortunately, this meeting was held just days away from President Trump’s speech on controlling drug pricing on April 26, so many of the federal government speakers avoided being very specific.
There were eight presentations over the course of the six-hour meeting that ranged in topics from point-of-sale rebates, biosimilars, and how upcoming policy is going to change the drug-pricing landscape. The focus was on how these affect PBMs but, obviously, it all flows down to the patients.
The best word I can think of, as a patient, of my impression of the meeting is “disturbing.” I didn’t find a lot of information that gave me hope, but I heard a lot that makes me think that obtaining the medications we need at affordable prices is going to be even more complex.
It’s not practical in this space to recount all my notes from the meeting, but here are some bullet points that I believe are particularly pertinent to RA patients:
- On a personal note, one of the first things that occurred was that I rode in the elevator with a representative from the FDA who had no idea that PBMs had any influence over the prescribing and availability of biosimilar drugs. For example, if a biosimilar is deemed “interchangeable” with the original/reference drug, depending on state law, the pharmacy could substitute one for the other without notifying your doctor. While not exactly the same, this is similar to getting a generic substituted for the brand-name drug your doctor prescribed.
- The various federal government representatives underscored that the primary focus is on opioids, opioids, and opioids. There was no mention of separating the effects of illegal opioids such as heroin) that account for the great majority of opioid-related deaths from the needs of legitimate needs of patients with either chronic or acute pain. There are currently about 400 federal bills “in markup” addressing the opioid situation.
- A representative of Prime Therapeutics discussed point-of-sale rebates, which is a controversial topic at the moment. When prescription drug prices are negotiated, the manufacturer will sometimes provide a rebate to the PBM. Theoretically these rebates are distributed to the patient through such benefits as lower premiums and copays. A point-of-sale rebate would be given directly to the patient and applied directly when the patient picks up his/her prescription at the pharmacy. Obviously, this is a highly complex issue that concerns the type of insurance policy as well as the logistics of applying a blanket rebate to an individual prescription at the payment register. That being said, it’s possible that we will see some limited variations of these programs in 2019.
- One of the things that Scott Gottlieb of the FDA talked about was making it easier to bring biosimilars to market. An initial step is that the FDA will be looking at certain practices they consider as interfering with competition. But beyond that, they will be looking at the original/reference drugs. Because biologics are “grown” rather than manufactured, there is a certain amount of natural variation from one batch of a drug to the next. Because biosimilars have to show comparable results to the original biologic, this can be difficult because of the variations of the samples they use to test against. The FDA is proposing to tighten up those variations. As a patient, I think this is generally a good thing because I want every dose of medication I take to be exactly like the last one so I can depend on the results. As a practical matter, however, I’m not sure how this will exactly speed biosimilars to market in the near term. The variations must first be identified, then analysis needs to be done to account for those variations, then changes to the manufacturing processes would need to be made, then quality control studies conducted to see if the manufacturing process changes worked, and [repeat as necessary], and finally reported back to the FDA. In my estimation, this process alone could take years and, because of the added burden to the manufacturers, actually increase the cost of the original drug. And the pharmaceutical manufacturers are going to like this idea because it helps increase competition for their products?
- There were some interesting notes from the state legislative group. In my home state of Texas, for example, health care was the large part of the state budget for 2012 through 2016. There is a real concern for the viability of the local pharmacy which is critical, specifically in suburban and rural communities where access to pharmacies is very limited. Finally, there is a concern on how to regulate PBMs. The concern is that the state(s) would be regulating what is a consensual business-to-business (PBM to insurance company) contract. My concern is that the states are looking at it as a business relationship and not as protecting the consumer/patient.
- Even though it doesn’t sound like it, I appreciate the fact that PBMs actually do a lot of good. However, attending the PBM Policy Forum only served to underscore my fear that the current drug pricing environment is a quagmire that is only get more complex.
Beyond that, I believe that healthcare is (or should be) about the patient. Think about it, without the patient, there is no reason for healthcare to exist. I actually counted the times that a benefit for the patient was mentioned. In the six hours of the conference with sessions presented by some of the leading minds in pharmacy benefits and public policy, this was a paltry total of seven times. This, more than anything for me, was a telling barometer of the meeting.