JustCare

Tag: CVS Caremark

  • Republican Congressman accuses drug middlemen execs of perjury

    Republican Congressman accuses drug middlemen execs of perjury

    You might not know what a PBM–Pharmacy Benefit Manager–is, but PBMs are among the biggest companies in American, profiting handsomely from driving up your drug costs. A Republican Congressman, Rep. James Comer, who chairs the House Committee on Oversight and Accountability is going after PBM execs for misleading the Committee with findings that are at odds with the facts, reports Page Minemyer for Fierce Healthcare.

    The three biggest PBMs, which control more than 80 percent of the pharmaceutical market, are Optum Rx, owned by UnitedHealthcare, CVS Caremark, owned by CVS, and ExpressScripts, owned by Cigna. Among other misrepresentations and alleged perjuries, their execs would not concede that their companies steer patients to affiliated pharmacies or pharmacies their companies own.

    Congressman Comer said that the execs could be punished financially and sent to jail for as many as five years for their alleged perjuries. That might be a first. As a general rule, low-income individuals spend more time in jail for petty theft than executives at big companies that gouge Americans financially, harm them physically, and worse.

    But, Congressman Comer lets the PBM execs off if they “correct the record.” Based on Express Scripts’ response to Fierce Healthcare, it sees nothing inaccurate with the representations of its executives. Its spokesperson talks about how Express Scripts reduces the cost of medications, without mentioning that the bulk of those savings go into its pockets and the pockets of insurers. PBMs too often drive up costs for individuals.

    Congressman Comer focuses on the harm these PBMs inflict on local independent pharmacies through their bad acts. And, he appears to want to do something about that. If course, in a world with negotiated drug prices, which is the only way to address outrageous prices and prevent monopoly pricing, these companies would serve no useful purpose. That’s the world that Congressman Comer should be helping to create, not undermining. But, that’s not where Republicans in Congress stand. They uniformly opposed the drug price negotiation provision for Medicare in the Inflation Reduction Act.

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  • CVS profits from manufacturing its own generic drugs

    CVS profits from manufacturing its own generic drugs

    CVS has become the sixth largest corporation in America, owning not only a chain of pharmacies, but health insurance company Aetna, and Pharmacy Benefit Manager (PBM), Caremark, among other big businesses. To maximize profits, CVS offers many private label products. To increase those profits further, CVS has begun to sell its own prescription drugs, reports David Wainer for the Wall Street Journal.

    Bottom line, CVS believes that selling its own biosimilars will generate handsome profits. CVS can steer its customers to these generic drugs through its Pharmacy Benefit Manager or PBM, which determines the drugs on many insurance companies’ formularies, including Aetna’s. In the process, CVS can put competitor manufacturers with lower-cost biosimilars out of business.

    The Cordavis unit of CVS Health – lord knows how CVS came up with the name—works with drug manufacturers to create the biosimilars CVS sells. Biosimilars are the generic version of biologicals, prescription drugs made from living cells. The biosimilar market is booming as more blockbuster biologicals, such as Humira, lose their patents.

    Beginning shortly, Humira will no longer be available on CVS formularies. CVS will offer its biosimilar. Similarly, Cigna, which has its own PBM, Express Scripts, will take Humira off its formulary and instead offer its private label biosimilar. For now, the cost will be low for patients, 85 percent lower than Humira’s list price, with no out-of-pocket costs to patients.

    CVS projects that the biosimilar market will grow exponentially in the next five years to $100 million. It was not even $10 million just two years ago. CVS will steer its customers away from brand-name biologicals to its biosimilars and profit big time in the process. Over time, will patients save money and how much? That’s largely up to CVS, an untenable truth.

    The bigger question is how will patients fare as biologicals are replaced by biosimilars? It’s not at all clear; at least for now, it is out of government hands. PBMs, such as CVS Caremark, can and will use their power to determine which drugs people use and at what cost in order to maximize their profits. Before long, some say it’s likely that there will be no prescription drug price competition, only strategies among the PBMs and insurers to maximize profits.

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  • Blue Shield of California ends contract with CVS Caremark in attempt to lower drug prices

    Blue Shield of California ends contract with CVS Caremark in attempt to lower drug prices

    FierceHealthcare reports on Blue Shield of California’s decision to end its contract with CVS Caremark in an attempt to lower drug prices for its 4.8 million enrollees. CVS Caremark has been doing all price negotiation and formulary design for Blue Cross of California and pocketing a lot of the rebates and fees it collects from pharmaceutical corporations. Will Blue Shield of California’s enrollees actually see their drug costs drop?

    Going forward, Caremark will only handle specialty drugs for Blue Shield of California enrollees. Amazon Pharmacy, Abarca, Mark Cuban Cost Plus Drugs and Prime Therapeutics will also be involved in different ways in ensuring enrollees have their prescription drug needs met.

    Prime Therapeutics will take on drug price negotiation with the pharmaceutical companies. Abarca will pay pharmacists for people’s drugs. Cost Plus Drugs will develop a simple way of pricing drugs so that people are not surprised when they go to the pharmacy. Amazon will be in charge of drug deliveries and will let enrollees know upfront the cost of drugs.  

    Blue Shield of California says it would like to reduce drug costs by 10 to 15 percent. Given how much money the PBMs currently earn from negotiating drug prices and pocketing rebates and fees for themselves, that should be more than feasible in theory.

    Blue Shield of California says it wants to eliminate drug rebates and fees. But, time will tell if it simply has developed a new prescription drug model that contributes more to its revenues. Blue Shield of California could simply be transferring some profits away from CVS Caremark to itself. 

    The US spent $600 billion a year on prescription drugs in 2021. That’s $1,500 for every individual. Spending continues to rise significantly. Congress has yet to do anything meaningful to lower drug prices other than to give Medicare some negotiating power over a very small number of drugs through the Inflation Reduction Act. So, at this point, any activity that could lower drug prices is a plus.

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