Published on discoverwhatyouthink.blogspot.com
The Amazement and the Price of Innovation: PBMs
Recently, you may have heard or read in mass media sources about the issue of what are known as pharmacy benefit managers that have clients who are prescribed medications created by what are known as red biopharmaceutical companies. Being truly innovative therapies for patients, they are very costly and require those who are prescribed such drugs to pay a great deal of money due to the placement of these meds on their PBMs on the highest level, which is a 4 on a tier 4 system.
PBM is an acronym for a pharmacy benefit manager and is insurance for prescription medications, along with perhaps being owned by your health insurance company. The co-pay that is asked of you is at the discretion of both the PBM and your employer who may provide the PBM to you, without you being involved in such a dialogue. Kickbacks and collusion are possible between employers and PBMs, so how medications are tiered on a PBM may have nothing to do with what is best for you, as variables that are considered in such a negotiation are known only by the PBM employee and your employer.
Ironically, biopharmaceutical development occurred around the same timePBMs began soon after the Vietnam War, yet before the Bayh-Dole Act in 1980 and were created by managed care organizations. The three largest PBMS are Caremark, Medco, and Express Scripts. These PBMs in past years have paid settlements between 200 and 300 million dollars for criminal acts such as paying kickbacks to MCOs for exclusivity while receiving kickbacks from the pharmaceutical industry to gain product preference on their pharmaceutical formularies. Biopharmaceuticals just aggravate an already corrupt system.
Beginning in the 1970s, followed by the implementation of the Bayh-Dole Act in 1980, biopharmaceuticals were being created at a notable rate for new treatment for those who typically have a serious medical disorder. They were a new paradigm of medical treatment, as biopharmaceuticals make and modify large molecules, such as a hormone or a protein, by utilizing a living biological system. The medications that existed before this advent were synthetic, small molecule and carbon based medications. Some say the cost to make a biopharmaceutical is only a third more expensive than the older generation drugs Yet the price of biopharmaceuticals can be 10 times or greater than other medications, and perhaps the cost was determined for what previous treatments cost, such as chemotherapy, which I understand can cost quite a bit as well.
Synthetic insulin is an example of such a biopharmaceutical treatment option for the patients with diabetes who need insulin replacement. Furthermore and presently, generic biopharmaceuticals are not allowed, which will be called biosimiliars. And with biopharmaceuticals, there are about ten types of large molecular therapies for various disease states. Yet out of close to 200 biopharmaceutical companies, only a small fraction of them are remotely profitable.
Biotechnological medications began to be used primarily in the 1980s and now presently make over 60 billion a year, with about 20 percent growth in this market annually. This creation of innovation occurred soon after the activation of the Bayh/Dole act of 1980, which basically created capitalists out of academics using your tax dollars. This may explain the rapid growth of this new technology.
With anemia patients, oncology and dialysis clinics are targets for two biopharmaceutical product that are identical, yet owned and named differently, which are Procrit by Johnson and Johnson, as well as Epogen, made by Amgen, and they are called ESA drugs. These biopharmaceuticals treat anemia typically associated with the treatment and conditions for certain deadly and chronic diseases, such as cancer and chronic kidney failure patients on dialysis.
Because of the EPA representatives habitually giving the doctors of these patients monetary rebates when they administer more of these types of drugs, patients are at times over-dosed with ESA drugs, which is deadly and dangerous, because patients are harmed or die quicker due to their hematocrit levels being too high and outside of normal limits related to their chronic and devastating disease states.
The media brought this deception to our attention some time ago, and not much was done, even though diseases that afflict those such as End stage Renal Disease Patients themselves cost Medicare over 20 billion dollars a year. Then add on the ten or so drugs such patients take regularly, and you have a very costly situation.
Soon, nanotechnology will be the next innovation in creating similar medications. Yet for now, biopharmaceuticals will arrive with great anticipation of many to treat various forms of cancer soon, as this disease is the focus of biopharmaceutical development at this time. In fact, I have heard that about 30 percent of pending therapies are biopharmaceuticals that now have captured 10 percent of the pharmaceutical market. Arthritis therapies are anticipated as well.
Another successful type of this type of therapy is a biopharmaceutical called Enbrel for RA, which is a devastating type of arthritis. The treatment was so popular due to the relief it provided for such patients, at one time, at least 1,000 patients each week had to wait for the drug to arrive, as it could not be created fast enough. Launched by Immunex in 1998, RA patients clearly benefited and were relieved by this treatment that now exists for them. Anticipating the need and success of Enbrel, a large pharmaceutical company which is now Wyeth bought Immunex soon before or after Enbrel was launched, yet acquired most of the stock of Immunex before its approval. Today, Enbrel is promoted by both Amgen and Wyeth and is the top selling biologic available.
Another biopharmaceutical company that got noticed was Genzyme, and they made anti-viral meds that were biotech products, and marketed them after acquiring the presumed business acumen of Don Rumsfeld in 1977, who shared in the profits because of this mutual relationship of the two. Genzyme produces biopharmaceutical for rare, but deadly diseases, and are known to charge the most for their products.
Furthermore, Mr. Rumsfeld was CEO and president of a pharmaceutical company called G.D. Searle in 1997, which is now part of Pfizer.
Yet, some claim that the benefit value provided to these sick patients is a bit limited, considering the high cost of biopharmaceuticals. Very few extend life of these sick patients much. However, at this time they may be limited to their treatment options. Is it really worth tens of thousands of dollars a year for the very sick to have their lives extended minimally for the most part?
Presently, there are many that approach the FDA and aggressively insist that generic biologics therapies be allowed into the market for the benefit of these critically ill patients, and this would be of great benefit for such patients, and this can be done, as far as the generic creation of these meds that presently, and unlike traditional drugs, now have unlimited patents. And this situation illustrates one of many flaws in the U.S. Health Care System- when the sickest have to complicate their illnesses by possible if not likely financial stress, such as the case with biologic drugs discussed. Relief is needed for those of such great illness, and should be demanded by the public. Bills by both the house and senate were introduced to lawmakers in 2007. After all, why be so sick, and then be financially ruined during the last chapter of your life?
PBM insurance void of being the social good it should be infects others. The concept of this entity as of one being beneficial to others has atrophied as perceived by others. Ultimately, U.S. citizens need to tae care of each other regarding issues such as this to reacquire a functioning society that does not focus on the gain of the individual capitalist while the sickest in our country at times way too often are absent of much needed treatment for incredibly devastating illnesses.
?Nothing is illegal if a hundred businessmen decide to do it.? --- Andrew Young
Dan Abshear
Author?s note: What has been written is based upon information and belief.
The payment, of course, is a mere slap on the wrist to Express, which claims to handle prescriptions for 50 million Americans and which earned $568 million last year on revenues of $18.3 billion. PBMs like Express are the middlemen of the pharmaceutical industry — they buy drugs in bulk and supply them to pharmacies and to patients via home delivery. Along the way, they carry out a variety of studies on drug cost-effectiveness intended, they say, to help pharmacies and health plans offer the best prescription-drug plans for the lowest cost. Sometimes PBMs encourage patients to switch to comparable drugs — usually to generic versions, but sometimes to other brand names — as part of their efforts to keep costs low.
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