January 6, 2021
Driving Affordability by Reducing Wasteful Pharmaceutical Spending
PBGH studied wasteful pharmaceutical spending and discovered a twisted and opaque supply chain that often favored higher-priced unnecessary drugs.
Key program elements
- Evaluated the drug utilization data of 2.5 million claims from 15 self-insured employers to estimate savings from reduced use of drugs.
- Investigated PBM industry’s profit model.
- 6% of drugs were wasteful (868 different drugs)
- $63.3 Million savings potential
- 3-24% Reduced spending on PBM
- 8 Drugs accounted for a quarter of the savings