Pharmacy Benefit Managers in the Public Eye
Congress is currently considering several acts at various stages of the legislative process, including the Pharmacy Benefit Manager Reform Act, Ensuring Timely Access to Generics Act, Retaining Access and Restoring Exclusivity (RARE) Act, and Expanding Access to Low-Cost Generics Act. Among the highlights of these acts are provisions to ban spread pricing, increase transparency in reporting, promote fair competition, and improve options and access to critical medication through generics or biosimilars.
- The Pharmacy Benefit Manager Reform Act is a broad-sweeping piece of legislation that includes movements to ban spread pricing and clawbacks and require PBMs to supply thorough annual reports to the Federal Trade Commission (FTC).
- Through the Ensuring Timely Access to Generics Act, lawmakers intend to increase competition for generic drugs by establishing greater oversight in the Food and Drug Administration (FDA) approval process.
- The RARE Act is in response to the 2021 decision from Catalyst Pharms., Inc. v. Becerra. The proposed legislation would fix drug exclusivity issues related to this decision and further incentivize innovation from drug manufacturers.
- The Expanding Access to Low-Cost Generics Act has been proposed to amend the Federal Food, Drug, and Cosmetic (FD&C) Act’s 180-day exclusivity period in order to widen approval criteria for subsequent generic drug applications.
Through these areas of focus, lawmakers are striving to reinforce what’s working in the PBM industry and fix what’s not. Generics and biosimilars, for example, provide pathways to more cost-effective treatment. With multiple bills working to increase access to these medications, health plans and patients would experience an even stronger emphasis on high value, low cost therapies. Further, lawmakers assert that mandating accurate, timely and transparent reporting would provide greater clarity around reimbursement rates and practices, and the methods from which they are derived.
We’ve observed that politicians from across the aisle have backed these bills as they sit in draft. However, it’s worth noting that while Congress appears committed PBM legislation, it remains unclear when any bill will make it across the finish line and into law. The most prominent cause for delay is the current state of the federal budget; it’s unlikely that PBM legislation will take priority until after the budget reaches resolution.
In spite of the noise this legislation has created, it’s important to note that PBMs do play a critically important role in containing drug costs and have the ability to deliver significant value to health plans and patients. PBD’s regulatory and compliance teams are closely monitoring these acts as the legislative process unfolds. Through the guidance of these tenured experts, we feel that we’re well positioned to seamlessly integrate and adhere to any new guidelines. Our model has been built on delivering the greatest value possible and our driving principle is, and always has been, excellence in service and quality care that protects the health plan’s bottom line.