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Arkansas interim study on drug prices hears competing views on PBMs, transparency and pharmacy survival

INSURANCE & COMMERCE - SENATE · December 16, 2020
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Summary

Lawmakers opened an interim study on skyrocketing prescription costs and heard testimony from PBM representatives, pharmacists, PSAO advocates and retailers about transparency, spread pricing and whether vertical integration is raising patient costs.

Arkansas legislators opened an interim study into rising prescription drug costs on a hearing that brought testimony from pharmacy benefit managers (PBMs), local pharmacists, pharmacy services administrative organizations (PSAOs) and large retailers.

Melody Schroeder, vice president for the Pharmaceutical Care Management Association, told the Senate Insurance & Commerce committee that PBMs are contracted vendors who administer pharmacy benefits, negotiate formularies and aggregate buying power on behalf of plan sponsors. “Drug manufacturers set the price of the drugs,” Schroeder said, adding that manufacturers receive the largest share of the prescription‑dollar and that specialty medicines are the primary current cost driver.

Pharmacists said PBM practices have squeezed independent pharmacies and called for…

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