Is Drug Pricing at an Inflection Point?
In recent months, we have seen encouraging signs of a new commitment to the social contract drug makers have with patients. Novo Nordisk and Allergan have made pledges to hold the line on drug prices. Mylan has taken responsibility for the price increases for EpiPen, and is promising to do more to advance affordability. More recently, Regeneron engaged early on in a meaningful and responsible way to discuss pricing of a new therapy.
At Express Scripts, we fully recognize there is no silver bullet to solving the problem of high drug prices. However, these discussions and concrete actions by some drug makers are a strong start, and we hope they are the first of many more to come.
Discussions to control costs have never been more important, as recent estimates put global drug spend at $1.5 trillion by 2021, according to data from Quintiles IMS Holding. Yet sometimes, in the drug pricing debate, blame is placed on one part of the drug distribution system when, in fact, all of us – pharmaceutical companies, pharmacy benefit managers (PBMs), policymakers and payers – have a role to play in achieving better affordability and accessibility for medicine. As the largest PBM, our job is to make sure our patients, and our clients who provide them a pharmacy benefit, are getting medicines at the lowest net cost while working with our industry partners to make that possible.
What Novo Nordisk, Allergan, and Regeneron are acknowledging is that the path we are on, in terms of ever escalating drug prices, is simply not sustainable. We want to reward drug discovery and true innovation. The best way to pay for our future drugs is to make sure we can afford what we currently have.
Every dollar saved today is an opportunity to pay for tomorrow’s innovations. To accomplish this goal, we have to come together as an industry, and as a society, to do many things better:
- Pharmaceutical companies have to demonstrate more rational drug pricing. They deserve to be rewarded for innovation, but at prices the marketplace can afford, not what it will bear.
- More competition means lower costs for American patients. Washington should act on policies that streamline the process for generics, including biosimilars, to come quickly and safely to market. Introducing competing versions of complex drugs into the market would save patients billions of dollars and have an impact similar to that felt by the introduction of generics decades ago.
- Payers must closely manage the benefits they provide, ensuring fairness and access while offering protections to their beneficiaries enrolled in high-deductible plans.
- And lastly, it is incumbent upon the pharmacy benefits managers to more forcefully illustrate the critical role we play in making medicine more affordable and accessible. For example, we partnered with a drug maker who was willing to lower the price of its hepatitis C drug. In doing so, we were able to provide 50,000 patients affordable access to this medication.
Recognizing that we each can do more to limit drug price increases is a step forward. That recognition paired with action can make real change possible. Are we at an inflection point in drug pricing? Only time will tell, but we are moving in the right direction.
Steve Miller, M.D. is Senior Vice President & Chief Medical Officer of Express Scripts, the nation’s largest pharmacy benefit manager.