PHARMACY

Walgreens CEO makes pharmacy’s case

BY Jim Frederick

CHICAGO The long struggle for recognition and reward for community pharmacy got another major boost Thursday.

Walgreens president and CEO provided the boost, courtesy of an interview and online story appearing in today’s Chicago Tribune. The headline said it all: “Pharmacists want to be paid more to better manage patients’ care.”

According to the Tribune story, Wasson “would like to have his army of ‘coaches’ taking on a greater role for Pres. Barack Obama should the White House and Congress come together to expand health-insurance coverage to the nation’s uninsured.”

Walgreens’ CEO told the newspaper the company’s 25,000 pharmacists could apply their skills in medication therapy management to the nation’s growing health care crisis, saving billions of dollars in health costs through patient interventions and preventive care.

“Fifty percent of patients are non-compliant with their medications after the first four or five months,” Wasson told the Tribune. “That costs the healthcare system.”

The executive made a strong case for raising pharmacists’ dispensing fees and for turning MTM and other pharmacy care programs into standardized, fee-paid services.

And, in a clear sign that some media outlets are beginning to “get it” when it comes to awareness of pharmacy’s value beyond prescription dispensing, the newspaper cited one solid example of that value: a pharmacy care pilot program, launched in 2007 by the Midwest Business Group on Health and Chicago-area pharmacists. That program, noted the Tribune, “helped four Chicago employers lower costs for workers with diabetes by more than $1,400 per employee in one year.”

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NCPA appealing AWP pricing settlement

BY Jim Frederick

ALEXANDRIA, Va. Stoking a long-simmering dispute over drug payments by health plan sponsors to pharmacies, the nation’s largest independent pharmacy group is appealing a lower court’s settlement of a lawsuit that would reduce the published average wholesale price figures used in pharmacy reimbursement contracts.

If the settlement is not overturned, said the National Community Pharmacists Association, the resulting cutbacks in pharmacy payment rates on many drugs could be devastating to community pharmacies. In response, NCPA said Wednesday it has filed an appeal with the First U.S. Circuit Court of Appeals.

The appeal seeks to freeze AWP-based payment rates to pharmacies at their current levels until the federal court has reviewed the mid-March settlement.

The original case revolved around the prices that union pension funds, teachers’ unions and other health plan sponsors were paying pharmacies to dispense drugs to their members. Historically, reimbursement rates have been based on the drug’s AWP. But the plan payers acting as plaintiffs in the original case charged in U.S. District Court that drug-price publishers had allowed those rates to rise to unrealistic levels, leading them to pay a 25% premium over AWP for some 8,000 drugs dispensed to their plan members.

Originally named in the health plans’ suit was First DataBank, which was accused of conspiring with McKesson Corp. to set AWP rates artificially high. But in May 2007, Medi-Span, a division of Wolters Kluwer Health, was named as a defendant in a similar class action involving the publication of AWPs.

“The groups alleged that the two publishers and the wholesalers illegally conspired to inflate the markup between Wholesale Acquisition Cost and AWP from 1.20 to 1.25. This resulted in higher costs to patients and third party payers,” NCPA noted in a statement.

Three years ago, the independent pharmacy group joined the National Association of Chain Drug Stores and the Food Marketing Institute in opposing a proposed settlement that would have rolled back the increase on those 8,000 drugs. That intervention, noted NCPA, “resulted in a $291 per day saving for every community pharmacy when U.S. District Court Judge Patti B. Saris rejected that settlement, savings that continue.”

In January 2008, the judge agreed with NCPA that the rollbacks on the 8,000 brand name drugs would be devastating to community pharmacy. Earlier this year, she pared the list to about 1,400 drugs to be reimbursed at lower rates, and extended the effective date from three months to six months after the settlement, as NCPA requested. “However,” the pharmacy group noted today, “even the reduced list will cause major reductions in Medicaid payments and a 4% cut in AWP-based reimbursements for pharmacies unable to renegotiate their PBM contracts by Sept. 26.”

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Mylan COO says Congress must ‘look further into use, abuse of authorized generics’

BY Alaric DeArment

PITTSBURGH An executive from generic drug maker Mylan said in testimony before Congress Wednesday that “authorized generics” launched by brand drug makers during a generic company’s customary six months of market exclusivity undermine competition.

Testifying before the House Judiciary Subcommittee on Courts and Competition Policy, Mylan COO Heather Bresch also said authorized generics – branded drugs that brand companies release under their generic names, often through third-party companies – delay access to generic medications for patients, taxpayers, government agencies and businesses.

“When it comes to settlements, Congress need look no further than the use and abuse of authorized generics by brand manufacturers,” Bresch said in the hearing, which the subcommittee convened to debate so-called “pay-to-delay” agreements between brand and generic drug companies. “The increase in the number of patient litigation settlements in recent years is directly related to the increased use of authorized generics during the 180-day market exclusivity period.”

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