Drug Price Competition IS Possible (and so are continually decreasing drug prices)

If you think we’re all stuck with the current crummy prescription coverage system – with manufacturers and PBMs engaged in a two-step dance that continuously increases drug prices – think again!

In an article published by STAT, our own Linda Cahn describes how Amazon – or several other entities like Anthem or Walmart – could entirely transform our current system and create a functioning marketplace with real drug price competition.

Succinctly summarized, all we need is for a large entity to form a new type of PBM that —

  • Renounces the PBM industry’s secret deals with manufacturers that result in rebates and other hidden payments that drive up drug costs
  • Instead requires every manufacturer to simultaneously submit on a “Bid Day” its “net prices” for every drug for the following six month period (factoring in all price reductions)
  • Six months later, provides every manufacturer with the opportunity to change its drug prices for the next six month period
  • Continues to conduct Bid Days every six months thereafter
  • Publishes every price – by drug and by therapeutic category – on an App so everyone can compare the actual prices of every drug in every therapeutic category
  • Also assembles and disseminates on its App efficacy/safety/and side effect information on every drug – by drug and by therapeutic category
  • And thus enables all doctors and patients to search for the lowest-cost and best drugs to prescribe and take, as well as to avoid those drugs that are priced non-competitively or of little or no real therapeutic value

Cahn details how the above innovations will inevitably disrupt the entire marketplace, force manufacturers to reduce their prices repeatedly, and allow the disrupter to shatter and dominate the PBM industry.

Read the article, and circulate it to everyone you know! In so doing, you’ll help create the pressure for at  least one large player to create a new type of PBM and finally shake up and transform our malfunctioning prescription coverage system.