The public is not informed about drug pricing

  • On May 11, 2018, President Trump announced his plan titled, “American Patients First,” an effort aimed at lowering the price of prescription drugs.
  • One key element of this plan is to require drug manufacturers to publish list prices for their prescription drugs in television advertisements.
  • Three-fourths (76 percent) of the public favor the federal government requiring prescription drug advertisements to include a statement about how much the drug costs.
  • In a rare instance of bipartisanship, this policy proposal is supported by a majority of Democrats (83 percent), independents (73 percent) and Republicans (72 percent)

The public doesn’t understand drug pricing and this new survey is just more proof. The reality is very few people actually pay the list price, and the amount of money actually received by the drug company – the net price – is typically much lower. Discounts vary, but they can result in significant discounts of as much as 50% or greater depending on the program . When the government is the payer, the vast majority of purchases have mandated rebates and discounts of significant amounts.  So how would publishing a list price for a drug actually help?

It wouldn’t, but remember we are living in an age where the media likes to point fingers at drug companies.  Sure, there are some that deserve it such as Vertex and Gilead for their outrageous prices on key drugs, but PBM’s and insurers have a lot more to say about what patients will pay for their Rx’s.

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Earlier this year, in Atlanta, Houston and Denver, we gathered patients who currently take one or more Rx’s and asked about this subject. At first they loved the idea of listing a drug’s list price, but when the moderator showed them a chart of how a list price is actually discounted by a PBM they really were more in favor of having a product website that listed which insurers covered the drug and to what extent.

Why do those in Congress support the idea of listing a drug’s price? Because on the surface, it looks like they are doing something, but unfortunately it means little.  As I have said before, even if all prescription drugs were free our health care costs would still be going through the roof.

 

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