PBM Practices Under FTC Scrutiny; APCI Applauds Decision
BESSEMER, Ala., June 7, 2022 /PRNewswire/ -- American Pharmacy Cooperative, Inc. (APCI) applauds the decision by the U.S. Federal Trade Commission (FTC) to launch a study into the anticompetitive practices of pharmacy benefit managers (PBMs) and they harm they cause to patients, taxpayers, and pharmacies.
The commission voted 5-0 on Tuesday in favor of launching the inquiry and will send a compulsory Order to File a Special Report to the six largest PBMs to provide information and records related to their business practices.
According to a release from the FTC announcing the study, "[T]he inquiry is aimed at shedding light on several practices that have drawn scrutiny in recent years" and will address practices such as fees and clawbacks charged to pharmacies; "steering" of patients to PBM-owned pharmacies; how pharmacy reimbursements are determined; how manufacturer rebates affect which drugs are covered, and related issues.
APCI has long advocated for federal oversight of PBMs and raised many of the issues the study proposes to investigate.
"APCI and our member community pharmacists are beyond pleased with the decision by the FTC to launch this study into how PBM practices increase drug prices and restrict access to lifesaving drugs," said APCI CEO Tim Hamrick. "We want to thank FTC chair Lina Khan and the rest of the commissioners for their unanimous vote to investigate an industry that has been in dire need of significant oversight for years.
"As an organization, APCI and its members have advocated aggressively for the federal government to investigate anticompetitive PBM practices," Hamrick added. "APCI offered testimony to the FTC in February of this year and submitted written comments in May regarding anti-competitive PBM practices. We very much look forward to working with the FTC, Congress, and other stakeholders to rein in these problematic issues that are detrimental to patients, taxpayers, and small businesses."
The FTC's order requests a wide range of information from the PBMs and should provide the commission with a wealth of data, said Greg Reybold, APCI's Director of Healthcare Policy and General Counsel.
"We are extremely pleased with the depth and scope of the information the FTC is requesting from these middlemen," Reybold said. "For years, PBMs have operated in a black box and FTC scrutiny of PBM practices that restrict patient access to care and raise prescription drug costs falls squarely within the commission's twin missions of protecting consumers and competition."
The decision to launch the study comes after the commission deadlocked on an earlier vote in February to investigate PBMs. Following that vote, the FTC issued a Request for Information about PBM practices and received a staggering number of public comments on the issue more than 24,000 to date.
Commissioners Noah Joshua Phillips and Christine S. Wilson, who voted against the earlier study, issued a concurring statement in support of the new study.
"This 6(b) study was prepared with input and leadership from our PBM team. It is scoped to study the competitive impact of PBM practices, including critically how those practices might impact out-of-pocket costs for consumers," the statement reads. "The study will examine relationships between PBMs and pharmacies and also PBMs and pharmaceutical manufacturers, a matter of much public interest. This is a study we can support."
Bill Eley, APCI's Director of Legislative Affairs, added that he was pleased with unanimous vote by the commission.
"It is encouraging to see that the concerns about the previous proposal raised by commissioners Wilson and Phillips have been addressed in the design of the new study," he said. "It is crucial that the FTC ask the right questions when dealing with these middlemen."
APCI is a member-owned cooperative of more than 1,600 member pharmacies in 30 states. Established in 1984 and headquartered in Bessemer, Ala., APCI is proud to lead the fight for prescription drug pricing transparency and reform.
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SOURCE American Pharmacy Cooperative, Inc.