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When massive pharmaceutical corporations are confronted over their exorbitant pricing of prescribed drugs within the US, they typically retreat to 2 well-worn arguments: One, that the excessive drug costs cowl prices of researching and creating new medication, a dangerous and costly endeavor, and two, that center managers—pharmacy profit managers (PBMs), to be particular—are literally those value gouging People.
Each of those arguments confronted substantial blows in a listening to Thursday held by the Senate Committee on Well being, Schooling, Labor and Pensions, chaired by Sen. Bernie Sanders (I-Vt.). In reality, pharmaceutical corporations are spending billions of {dollars} extra on lavish govt compensation, dividends, and inventory buyouts than they spend on analysis and growth (R&D) for brand spanking new medication, Sanders identified. “In different phrases, these corporations are spending extra to counterpoint their very own stockholders and CEOs than they’re to find new cures and new therapies,” he mentioned.
And, whereas PBMs actually contribute to America’s uniquely astronomical drug pricing, their profiteering accounts for a small fraction of the large drug market, Sanders and an skilled panelist famous. PBMs work as shadowy center managers between drugmakers, insurers, and pharmacies, setting drug formularies and client costs, and negotiating rebates and reductions behind the scenes. Although PBMs practices contribute to general prices, they pale in comparison with pharmaceutical income.
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