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Lowering Drug Prices in 3 Easy Pieces | American Council on Science and Health

The Trump administration made three proposals last week to influence drug prices, the good, the bad and the ugly. Ending a gag rule on pharmacists is good, the plan to put the “list” price of drugs on those direct to consumer (DTC) pharmaceutical ads is bad, and the consideration of basing US drug prices on global prices, well that battle will be ugly.

The good

The President signed a bill allowing a pharmacist to discuss with patient’s lower cost drug options, and as I understand it, they will also be able to discover the difference in price between their insurance co-payment and the drug’s cash price. I have written about drug co-payments previously, and the dirty little secret is that in about 6% of cases for brand-name drugs and almost 28% of generic drugs, your co-payment covers not only the cost of the drug but includes a little “something extra” for the insurance company or pharmacy benefits manager (PBM) of your plan. So it should be no surprise that insurance companies and those PBMs have a “gag” rule in their pharmacy contracts prohibiting discussions about pricing. So overall, it is a win for consumers being more informed.

The bad

The President wants those DTC pharmaceutical ads to include the wholesale acquisition cost (WAC) that a manufacturer lists for any specific drug. Again, if you’re going to take a deeper dive, you can read these articles here and here. Think of it like a car’s sticker price, it puts you in the ballpark, but often has a tenuous relationship to reality. In this case, the administration wants the price for the course of treatment or a month’s supply in the case of medication taken chronically to be listed. Fair enough. Let’s take the idea out for a test drive. [1]

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Lowering Drug Prices in 3 Easy Pieces | American Council on Science and Health.