Policing the middle man of pharmaceuticals

Apr. 21—The pharmaceutical industry is worth hundreds of billions of dollars, but now multiple proposed bills at the state and national levels are taking aim at the amount of oversight for pharmacy benefit managers, key players behind the scenes.

PBMs work as middle men between many of those involved in the prescription process, whether that's an insurance company to a manufacturer or a doctor to a pharmacy, and often have a hand in which prescriptions are available to patients.

They're third-party companies that manage rebates and discounts paid to drug manufacturers, according to the Center for Insurance Policy and Research.

Missouri Senate Bill 402, proposed by Missouri Sen. Mike Bernskoetter, R-Jefferson City, would require PBMs to file annual reports about the rebates provided for a given year.

"What is this money being used for? Because it's obviously not being used to help the patients," Pharmacist Julie-Marie Nickelson of Roger's Pharmacy said. "It's probably just going into people's pockets. And that's not what a PBM was made to do. Unfortunately, that's what they have become."

But many PBMs might not be as independent as they appear. One company, CVS Caremark, is owned by CVS Health, while Express Scripts is owned by Cigna Healthcare. Prime Therapeutics, another PBM, is owned by Blue Cross Blue Shield Association.

Without any legislation in place, there's the potential for PBMs to take measures that would benefit the company but might come at customers' expense, said Park Hills, Missouri, resident Loretta Boesing, founder of the Unite for Safe Medications nonprofit organization.

"A prescription for a $10 antibiotic, that $10 antibiotic may not be the one that the PBM is going to get a huge kickback for, so they may not even include it on the formulary," she said. "They may make it, you know, a $20 to $50 co-pay for you. You don't know that you could get that for $10 at your local pharmacy, independent pharmacy."

U.S. Senate Bill 127, proposed by Sen. Maria Cantwell, D-Washington, would impose similar standards at a national level.

This doesn't mean insurance companies necessarily are engaging in suspicious activities said David Stevenson, a pharmacist and owner of Stevenson Family Pharmacy.

"If they don't comply with this — if this bill was passed into law — there could be serious consequences, financial and otherwise," he said. "That's what they listen to."

This isn't the first time there have been attempts for supervision, but it probably is the closest legislation has come to succeeding, Boesing said.

"I've spoken to many legislators who've had issues themselves or their staffers have had issues themselves with PBMs," she said. "They can't get the medications that they want. They're seeing their communities close, and pharmacy deserts in their own communities."

Stevenson says the current bills are the closest he has seen any attempts get to passing in his 40-plus years as a pharmacist.

Alex Simone can be reached at alex.simone@newspressnow.com. Follow him on Twitter at @NPNOWSimone.