All in All, It’s Just Another Crack in the Rebate Wall

Posted by Joe Stevens on Mon, Nov 11, 2019

Howard Deutsch co-wrote this blog post with Joe Stevens.

As the end of 2019 nears, a critical drug pricing question remains unanswered: Is the pharma “rebate wall” crumbling or are the rumors of its demise exaggerated? With the current “high list price, high rebate” model, pharma has been operating in a worst of both worlds scenario, taking blame for high list prices without reaping profits commensurate with those prices. Looking to break this cycle, pharma companies are beginning to bypass government and regulatory bodies, health insurers and PBMs in their efforts to address the rebate issue themselves, and we think that’s a wise move.


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A Tale of Two Patients: Who Will the Proposed Safe Harbor Regulation Most Benefit?

Posted by Pranava Goundan on Thu, Apr 11, 2019

Howard Deutsch and Kyle Harpole co-wrote this blog post with Pranava Goundan.

The U.S. Department of Health and Human Services has proposed a new rule for safe harbor protection of drug discounts, effective Jan. 1, 2020. While the rule hasn’t been finalized, it has received more than 25,000 public comments, indicating that the current rebate model likely will be swept out to sea in favor of a model that aims to more directly address beneficiaries’ concerns about rising out-of-pocket costs. The percentage of patients whose out-of-pocket spending exceeds $2,000 nearly doubled between 2011 and 2015. The proposed regulation focuses on curtailing these costs by establishing, among other things, point-of-sale discounts for beneficiaries. We recently wrote about how pharma can prepare for the shifting seas of a new access and reimbursement landscape. In this post, we’ll compare two common Medicare Part D, non-LIS patient populations, diabetes and rheumatoid arthritis, to demonstrate how individual patients’ payment contributions would change under the proposed regulation.


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The Rebate Rules Are Changing. Here’s What Pharma Needs to Do to Prepare

Posted by Howard Deutsch on Wed, Mar 20, 2019

Pranava Goundan co-wrote this blog post with Howard Deutsch.

In the classic political film, “The Candidate,” Robert Redford’s character, fresh off his victory, turns to his election strategist and asks, “What do we do now?” And the movie ends right there. The pharmaceutical industry now is facing a similar moment. After years of advocating for more transparent pricing and criticizing the rebate-for-access model for its perverse pricing incentives, pharma is on the cusp of partly getting its wish. But our movie doesn’t end there, so we must answer that question: What do we do now?


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Our Drug Rebate Prediction Is Coming True: Now Can We Turn Our Attention to the Value of Drugs?

Posted by Pratap Khedkar on Tue, Feb 12, 2019

We predicted last year that prescription drug rebates’ days could be numbered as more healthcare stakeholders clamor for price transparency. Judging by the new rule proposed by Health and Human Services Secretary Alex Azar and Inspector General Daniel Levinson, this has now come to pass. The proposal aims to wipe out the behind-the-scenes negotiation tool—which has been linked to a growing discrepancy between a drug’s list and net prices—and instead share the savings directly with Medicare patients. 


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