NCPA Executive Update

NCPA Executive Update delivers insights on legislative, regulatory, policy, and industry developments from NCPA CEO B. Douglas Hoey, Pharmacist, MBA, to NCPA members and pharmacy leaders every Friday.

A Week Full of Washington | NCPA Executive Update | February 16, 2018

by NCPA | Feb 16, 2018

Dear Colleague,

Doug Hoey

As we approach Presidents Day, some of the legends about George Washington just aren't true. He most likely did not throw a silver dollar 250 feet across the Potomac River (the U.S. didn't make silver coins until 50 years after he died). He didn't cut down his father's cherry tree (as far as his dad knew, anyway). We don't know if he actually said that he could never tell a lie, but his many astute tricks to fool the British Army surely count, at least, as white lies. He did not have wooden teeth (more likely they were made of ivory, or they were cow or horse teeth or metal alloys). But President Washington did say: "Truth will ultimately prevail where there is pains to bring it to light." This week proved him right.

First came a report from President Trump's Council of Economic Advisers, titled "Reforming Biopharmaceutical Pricing at Home and Abroad." It touched on a number of areas of interest to community pharmacists, but most important was Section 2.3 of the 30-page report:

2.3 Enhance Price Competition in the Pharmacy Benefit Manager Market
"Pricing in the pharmaceutical drug market suffers from high market concentration in the pharmaceutical distribution system and a lack of transparency …"

This section of the administration's report was consistent with the message NCPA has been conveying to the administration, Congress, regulators, consumer groups, and other industry stakeholders for years: PBMs, as they exist today, contribute to the higher costs of prescription drugs. One would expect the report to be full of policy positions that resonate only with Republicans. However, the left-leaning magazine, The American Prospect, ran a story titled "The Corporate Scam That Even Trump Opposes: PBMs." Perhaps there is more bipartisan support for Section 2.3 than we normally see in the city named after the Father of our Country.

Also this week, the Senate held a hearing on the nominations for the small, elite group of commissioners for the Federal Trade Commission. When fully populated, there are five FTC commissioners. Right now, there are only two. This week's Senate hearing was for four nominees.

So, if approved by the Senate, 80 percent of the FTC nominees heard Sen. Shelley Moore Capito (R-W.Va.) ask about her concerns with PBM consolidation and conflicts of interest (PBMs owning retail, mail order, and specialty pharmacies) and with leveling the playing field for community pharmacies.

Sen. Roger Wicker (R-Miss.) stated his concerns with the lack of PBM transparency and the one-sided negotiation leverage that PBMs have. Sen. Richard Blumenthal (D-Conn.) brought up his concerns with drug pricing and consolidation in the industry, and asked that his concerns be addressed.

At the same time, the House Energy & Commerce Oversight and Investigations Subcommittee was also holding a hearing on health care consolidation. Reps. Buddy Carter (R-Ga.), Morgan Griffith (R-Va.) and Diana DeGette (D-Colo.) brought up PBMs and the need for the FTC to take a look at them.

NCPA's message that PBMs contribute to higher drug costs is only part of our overall message. Importantly, there is a second part of NCPA's message: Community pharmacists are part of the solution to help lower overall health care costs. PBM reform is only part of the solution. Being paid for the value community pharmacists create beyond dispensing is essential to our future. That's why NCPA supports the development of clinically integrated networks like CPESN® USA. Why CPESN? Because CINs can negotiate together with payers in ways you can't today. Take this 10-question self-assessment to see if you are ready to be part of a CIN.

Washington also said, "It is far better to be alone than to be in bad company." Community pharmacy is not alone, and some important company added their voices to ours this week.

Doug Hoey

P.S. You can come give Congress a piece of your mind about PBMs by being a part of the NCPA Congressional Pharmacy Summit April 11-12 in Alexandria, Va. Community pharmacists will storm Capitol Hill and make their voices heard on DIR fees, MAC transparency and more. Sign up today: