PhRMA takes shot at payers in drug pricing war
- Industry trade group PhRMA on Thursday unveiled a new ad campaign that takes aim at payers in the back-and-forth debate over who should be held accountable for rising prescription drug costs.
- The ads accuse insurers of failing to pass along savings they receive from rebates and discounts given by drugmakers to secure coverage for their drugs, an issue PhRMA has been highlighting in sponsored research rolled out over the past several months.
- Branded under the title "Share the Savings," the campaign will run in print, digital and social media channels throughout the year and debuted Thursday in several print publications in Washington, D.C., including The Wall Street Journal and Politico.
PhRMA has aggressively stepped up its marketing efforts this year, aiming to move the needle in a debate that has frequently blamed pharmaceutical firms for rising drug costs.
In January, the trade association rolled out a multi-year national marketing campaign titled "Go Boldly" which paints biomedical researchers as pioneers forging ahead to discover new cures.
While that campaign highlighted industry innovation, PhRMA's new, more limited ads launched Thursday will target insurers and other payers.
"Your insurer doesn't pay full price for medicines. So why should you?" the ad reads, with large blue and black lettering contrasting starkly against a white background.
Drugmakers frequently give rebates and discounts on their products in order to secure favorable coverage from insurers, a practice that has resulted in a muddled and opaque pricing system in the U.S. While list prices for drugs are disclosed and known, the net price charged to insurers is not. In the past, this has given drugmakers a ready-made shield to defend against criticism of rising prices, as many will argue list prices don't reflect the true cost of a drug.
But as public anger continues to crest in the wake of pricing scandal after pricing scandal, PhRMA is turning up the heat on payers.
"It is a problem that more and more Americans are being asked by their insurers to pay cost sharing based on undiscounted list prices, even though insurers may be receiving significant rebates" PhRMA CEO Stephen J. Ubl said in a statement on the campaign launch.
Research sponsored by PhRMA found that that over 50% of out-of-pocket spending by commercially insured patients is based on the list price of a medicine, rather than the negotiated, lower net price. While many patients pay a fixed co-pay for a prescription, an increasing number are responsible for a higher share of costs due to higher deductibles or cost sharing.
Payers aren't sitting on their hands, though. The Pharmaceutical Care Management Association has frequently pushed back against industry claims, and PBMs like Express Scripts tout the savings they extract from drugmakers through price negotiations.
While PhRMA accuses payers of keeping those savings for themselves, the PCMA has said that savings are usually used to lower premiums rather than reduce cost-sharing on specific products.
"This latest campaign is an attempt to deflect blame for high drug prices onto the employers, unions, and insueres that struggle to provide coverage," PCMA said in a statement Thursday.
- PhRMA Press release
- BioPharma Dive Drug prices continue to climb, but who's to blame?
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