Dark Secret: PBM Profits
PBM Brand Drug Profits have come almost entirely from Pharma Companies for the Past 20 Years
BEFORE Medicare Part D:
- PBM profits came from secretly keeping MOST “pharma rebates”, instead of passing them on to patients and clients
-
- In 2003, the largest PBM, Medco (now part of Cigna/Express Scripts) kept more than half of "manufacturer brand drug rebates"
- For 2003, the brand drug "manufacturer rebates" Medco kept accounted for MORE THAN 100% of the the company's entire corporate profits
AFTER Medicare Part D:
- PBM brand drug profits have secretly come mostly from "pharma fees" tied to "sticker" prices and price increases
- The pharma/health insurer/PBM "partners" secretly switched from "rebates to “pharma fees” because:
-
- PART D required full rebate transparency for the first time
- Widespread pharma U.S. patent losses led to fewer U.S. brand drugs and less rebate opportunities
- Limited Part D "pharma fee" (i.e., bonafide service fee (BFSF)) reporting and oversight
- Enabled unlimited "pharma fee" payment to health insurer/PBMs tied to massive U.S. brand drug prices and price increases
-
- “PHARMA FEES” NOW SECRETLY ACCOUNT FOR 80-100% OF HEALTH INSURER/PBM PROFITS FROM U.S. BRAND DRUGS AND LIKELY MOST OF PBM OVERALL PROFITS
- NOW NEARLY 15 YEARS SINCE IT BEGAN, THIS SIMPLE, BUT SECRETIVE, PHARMA/HEALTH INSURER/PBM COLLUSIVE PARTNERSHIP HAS CAUSED UNPRECEDENTED PATIENT AND PUBLIC HARM