Congressional Crackdown on PBMs
After two years of intense negotiations, Congress is on the brink of finalizing a deal that will rein in pharmacy benefit managers (PBMs). According to a report by STAT, lawmakers have come to an agreement to extend telehealth flexibilities, allocate funds for public health programs, and implement significant changes within a government funding package set to be passed before the year’s end.
The specifics of the language in the proposed government funding package have not been disclosed publicly and are subject to change. However, the planned policies aim to establish boundaries around the operations of PBMs. Some of the anticipated measures include prohibiting PBMs from tying their payments to drug prices in Medicare, enhancing transparency, and regulating the payment methods PBMs use for drugs within Medicaid programs.
Moreover, the stocks of insurers who own major PBMs experienced a decline following President-elect Trump’s remarks during a news conference. Trump criticized PBMs as being “the horrible middleman that makes more money, frankly, than the drug companies” and vowed to lower drug costs to unprecedented levels.
Sanofi’s Legal Battle with HHS
In a recent development, pharmaceutical giant Sanofi has filed a lawsuit against the Biden administration, alleging that the company has been unjustly prevented from altering payment terms for select hospitals participating in a federal drug discount program. This legal action marks the fourth instance of a pharmaceutical company taking the government to court over similar disputes in recent weeks.
Sanofi’s lawsuit was prompted by the U.S. Health Resources and Services Administration (HRSA) threatening sanctions against the company if it proceeded with plans to implement new payment terms for hospitals covered by the 340B Drug Discount Program. Despite notifying hospitals and clinics of the impending changes, the HRSA intervened, accusing Sanofi of violating program regulations.
In its lawsuit, Sanofi criticized the HRSA for favoring hospitals’ demands and overlooking systemic violations while hindering the company’s efforts to prevent waste and abuse through revised payment models. The legal battle between Sanofi and the Biden administration underscores the escalating tensions in the pharmaceutical industry.
Expert Perspective: Ed Silverman
Ed Silverman, a seasoned journalist with nearly three decades of experience covering the pharmaceutical sector, highlights the complexities and contentious issues surrounding the recent developments involving PBMs and pharmaceutical companies. As a senior writer and Pharmalot columnist at STAT, Silverman provides valuable insights into the evolving landscape of the healthcare industry and the implications of these regulatory and legal battles on various stakeholders. His expertise sheds light on the intricate dynamics at play in the intersection of policy, economics, and public health, offering a nuanced perspective on the challenges and opportunities facing the pharmaceutical sector in the current regulatory environment.
