- Last November, the UAW Retiree Medical Benefits Trust proposed that drug makers should publish reports that provide insight into the risks that affect medication pricing. The SEC is now upholding that resolution.
- The trust wants transparency and insight into pricing, clinical benefits, patients access, the risk of payers pushing back against prices and price disparities between the U.S. and other countries.
- Two companies, in particular, have been targeted for this information—Gilead and Vertex—because of the high prices of their drugs and the fact that both companies have been targeted by payers over that pricing.
While both Gilead and Vertex felt that they should not have to disclose certain information about what they refer to as "day-to-day operations" to shareholders, the SEC disagreed. In fact, the SEC contends that a company's fundamental business strategy with respect to their pricing policies for pharmaceutical products is something that shareholders should have access to.
The UAW trust is a powerful force which provides health care to 750,000 retirees and their dependents and has a total of $60 billion under management.
Even now, as pharma companies are being forced into the position of negotiating with payer, it's hard to see what the reverberations will be. This situation provides insight into what some of the downstream implications may be over the long term.