PBMs GEAR UP — As legislation to overhaul the practices of pharmacy benefit managers snakes its way through Congress, the PBM industry faces an uphill battle against a cadre of opponents — including pharmacies, provider organizations, pharmaceutical companies and AARP, which advocates for consumers over age 50. Critics emphasize that the three largest PBMs — the pharmaceutical middlemen that manage prescription drugs for health insurers — control 80 percent of the market. But JC Scott, president of the trade group Pharmaceutical Care Management Association, said the industry is offering “alternative approaches†to insurance plans and new entrants into the PBM market. The impact of a largely consolidated PBM market can be consequential for smaller drug companies, such as Arcutis Biotherapeutics, according to its CEO Frank Watanabe. The executive, who has spoken with lawmakers on Capitol Hill, said that rebates to PBMs and administrative fees to related entities, called group purchasing organizations, are “far and away [his] biggest cost†among all the expenses Arcutis incurs to get its drug to patients. The House is readying a sweeping health care package with the hope of bringing it to the floor for a vote sometime this month — and the legislation is expected to contain a win for advocates pushing for changes to how PBMs operate, Megan reports. The bill, expected within the next week, likely contains provisions meant to illuminate the fees and rebates PBMs extract from drug companies and a prohibition on spread pricing in Medicaid so that a PBM cannot reimburse a pharmacy less for a drug than what it charged the insurance provider. PCMA is stepping up efforts to influence the package. The group recently hired former Pennsylvania Republican Rep. Ryan Costello to lobby on its behalf, who told POLITICO he is talking with his former colleagues about the benefits of PBMs. And Scott told POLITICO the proposals being floated in the House and Senate, if enacted, could limit “choices in ways that inadvertently lead to increasing costs to employers and unions.†IT’S WEDNESDAY. WELCOME BACK TO PRESCRIPTION PULSE. The Senate returns to a sweltering D.C. It should be cooler when the House returns next week. Send news and tips to Lauren Gardner ([email protected] or @Gardner_LM), David Lim ([email protected] or @davidalim) and Katherine Ellen Foley ([email protected] or @katherineefoley). TODAY ON OUR PULSE CHECK PODCAST, host Daniel Payne talks with POLITICO health care reporter Alice Miranda Ollstein, who explains why abortion disputes threaten the reauthorization of PEPFAR, a law governing the United States’ global HIV/AIDS relief work.
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