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As I see it consolidation isn’t the root cause. The central problem is that pharmacy benefits manager have been allowed to invert the normal market. Normally fo
by boublepop 6y ago
As I see it consolidation isn’t the root cause. The central problem is that pharmacy benefits manager have been allowed to invert the normal market. Normally for someone arranging the “resale” of a product from a producer to costumers would make more money if the price got negotiated down. But since PBMs have forced rebates of 70%+ that means that they are making most of the money on a drug sale. So even thought they are representing the buyers at the negotiation table, they want the prices as high as they can be.
Producers are sitting down at the table and outbitting each other not on how low the price could be, but how high they are willing to make it, it’s absurd.
And you’d think the insurance companies or pharmacies would object, but often they are owned by the same group so they all just share the proceeds from ripping of the people.
- nazgulsenpai 6y agoPharmacies, PBMs and insurance companies being owned by the same group is all an effect of consolidation. Source: worked for an independent specialty pharmacy that was purchased by a PBM that in turn merged with a major national insurer
- boublepop 6y agoI mean sure it’s an effect in the sense that when it happens we call it consolidation. My point is that none of the groups owning the insurance companies are buying up the pharmaceutical companies. And why should they? They are pulling home 2/3 of the profits of the price hiking campaigns they are driving and go about blaming it all on the companies who’s day-to-day is focused all about how we can make these drug cheaper, yet that never reaches the consumer.