Simple Scheme

The Decade-Plus Simple Scheme Behind Massive U.S. Brand Drug Prices

  • Pharmaceutical companies and the 4 dominant U.S. health imsurer/PBMs are secret “partners”
    • Both massively profiting from raising U.S. brand drug prices
    • While passing costs on to American patients, families, businesses and taxpayers
    • Causing massive 5-to-10-fold brand U.S. brand drug price increases and unprecedented patient/ public harm
    • While pretending to be “enemies”

Why and When Did it Happen?

  • Started with Medicare Part D in 2003-6
  • 4 dominant health insurers/PBMs control 80-90% of Part D
    • United Health, CVS/Aetna, Cigna/Express Scripts, Humana
    • The leading U.S. PBMs were OWNED by pharmaceutical companies just before Part D began 
  • U.S. and European brand drug prices the same prior to Part D
    • Americans now pay 8-10 times more for many brand drugs
      • Link to US vs EU Multiple Sclerosis (MS) Drug Prices
    • U.S. is the only country with PBMs 
  • How Does the Simple but Secret Scheme Work?
  • Abuse of a Medicare Part D “Loophole” – “Pharma Fees”
  • Pharma secretly paying health insurer/PBMs a “percent” of massive brand drug “sticker” prices and every price increase
    • Widespread secret national “pharma fee” contracts
    • “Pharma Fees” supposed to be for “supporting” patients
    • Instead often just for passing on massive price increases to the American public and driving huge corporate profits 

These secret “pharma fees” tied to U.S. brand drug “sticker” prices now account for most health insurer/PBM brand drug profits





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