NCPA endorses bill to increase transparency in generic Rx payments

ALEXANDRIA, Va. — Reps. Doug Collins, R-Ga., and Dave Loebsack, D-Iowa, introduced on Tuesday H.R. 5815 — the Generic Drug Pricing Fairness Act — which creates greater transparency in how PBMs reimburse pharmacies for generic prescription drugs under Medicare Part D, the military’s TRICARE program, and the Federal Employees Health Benefits Program.



The National Community Pharmacists Association endorsed the bill, which goes further than legislation the same two Congressmen introduced earlier year (H.R. 4437, The Generic Drug Pricing Transparency Act) that has the same remedies, but only applied to Medicare Part D, NCPA stated.



“Former Supreme Court Justice Louis Brandeis said ‘sunlight is the best disinfectant’, and Congressmen Collins and Loebsack have embraced those words of wisdom by offering a legislative remedy to how generic prescription drug pharmacy reimbursements are handled in three large federal programs,” stated NCPA CEO B. Douglas Hoey. “Under this legislation community pharmacies would have basic insights into the criteria PBMs use to calculate reimbursements and experience more timely payment updates when generic price spikes occur. This proposal would allow community pharmacists to spend more time helping patients maximize their health outcomes.” 

 

While H.R. 5815 is being introduced as the 113th U.S. Congress draws to a close, Reps. Collins and Loebsack have promised to re-introduce it once the 114th U.S. Congress convenes next year. Collins and Loebsack are continuing the momentum that has been generated on this issue in recent months.



For example, on Nov. 20th the U.S. Senate conducted a hearing on the generic price spike issue at which numerous experts testified, including pharmacist and independent owner Rob Frankil of Sellersville Pharmacy in Sellersville, Pa., who appeared on behalf of NCPA. He went into great detail about the sudden nature of the price spikes and their impact on patients, payers and community pharmacists.



Generics comprise approximately 80% of drugs dispensed and price surges of 1000% or more occur regularly and virtually overnight, yet PBMs may wait weeks or months to update reimbursement and rarely do so retroactively, NCPA stated. Frankil explained that pharmacies “are put in the untenable position of having to absorb the difference between the large sums of money that they spent to acquire the drugs and the lower amounts that they are paid by the PBMs.”



In response to NCPA’s concerns, in May the Centers for Medicare and Medicaid Services issued a final rule for Medicare Part D that brings more transparency to generic pricing and requires price updates every seven days starting in 2016. While H.R. 5815 and H.R. 4437 would each go further than the steps taken by CMS, this acknowledgement by the federal government demonstrates the sound footing of the arguments NCPA and its allies have made for years, NCPA stated.