Employers’ Prescription for Affordable Drugs
Drug manufacturers and middlemen, such as pharmacy benefit managers (PBMs), sustain high drug prices by gaming the system at the expense of employers, taxpayers and the government.
Led by PBGH, The Employers’ Prescription for Affordable Drugs, a coalition of The Purchaser Business Group on Health, National Alliance of Healthcare Purchaser Coalitions, The Erisa Industry Committee (ERIC) and Silicon Valley Employers Forum, supports policies that would require PBMs to make pricing data available to payers and compel drug companies to report and justify price increases for some medications. The coalition also seeks to strengthen competition and remove barriers that stifle the development and use of generic drugs and biosimilars.
Strengthening market forces is the best way to improve efficiency and quality, but the drug market has several unique characteristics that require public policy intervention to protect consumers.
Employers should adopt value-based purchasing strategies to contain drug costs and create programs that model best practices for other companies.
Government Insurance Responsibility
Government-run insurance programs, such as Medicare, must use their bargaining power to help rein in costs for the entire drug market.
Policies to rein in drug costs should address drivers of high drug costs across the system rather than focusing on a single group, such as Medicare, and should not simply shift costs to employers and consumers.
Transparency is essential to containing costs since much of the drug supply chain is opaque to consumers due to complex payment arrangements and gag clauses.
Government should incentivize innovative drug development and prevent companies from exploiting the system for profit by blocking generics and biosimilars.
Patients, especially those with serious conditions, should not be faced with excessively high bills to get the medications they need to survive.