Advocating for Better Drug Pricing Policy at HHS

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May 18, 2017
Former Executive Vice President and Chief Operating Officer, CVS Health

Health & Human Services Secretary Tom Price has been holding ongoing “listening sessions” on drug prices with attendees from a range of industry groups and advocates. The sessions demonstrate the widespread awareness of, and the Trump administration’s seriousness about, taking action on drug prices.

There are a number of actions that both Congress and the administration can take to help lower drug prices

CVS Health executives attended these sessions, and highlighted issues that are important to our clients. We used the opportunity to inform the Secretary and his staff about the role of a pharmacy benefit manager (PBM) and how we help clients control drug costs and improve health outcomes for their members. We also discussed steps the Federal government could take to better support our efforts. We are pleased that the Secretary intends to take the information provided in the listening sessions to help shape policy proposals.

Fostering Competition

Increasing market competition is critical, and there are several ways to accomplish it. We advocate that the U.S. Food and Drug Administration (FDA) address the backlog of generic applications, and prioritize their review to emphasize generics first. When there is a brand drug with a patent about to expire, or that has expired, review of the generic alternative should be prioritized to ensure competition as early as possible. Priority should also be given to products that will compete with single-source generics and to brand products in classes with limited competition.

A consistent, reliable process for reviewing and approving biosimilars, and finalizing FDA guidance on biosimilar interchangeability, could also expedite access to these drugs and help improve competition in some very costly product categories.

Lowering Costs for Consumers

The second key measure is to help consumers for whom prescription drug costs can be an obstacle to care. In the listening sessions, we recommended that high deductible plans associated with health savings accounts should have the option of covering prescription drugs outside the deductible, regardless of the preventive exception. A change in the statutory language or Treasury regulations would provide health plans the option to craft a drug benefit that encourages beneficiaries to take their medications as prescribed and keep costs low.

Addressing Anti-Competitive Behavior

Last but not least, more needs to be done to restrict anti-competitive behavior on the part of drug manufacturers. Some manufacturers abuse an FDA program called Risk Evaluation and Mitigation Strategies (REMS) to prevent generic competitors from accessing samples of drug products, thereby impeding their ability to demonstrate equivalency and receive FDA approval. Manufacturers also engage in patent settlements to pay-for-delay — pay potential competitors not to bring generic or biosimilar alternatives to market. Some manufacturers have even used citizen petitions to delay competitors from entering the market. Even when the FDA does not side with the manufacturer, it can take months to reach a decision in such cases, and the delay benefits the manufacturer filing the petition.

These measures can help bring about a meaningful change in the trend of rising costs and make prescription drugs more affordable and accessible for our clients and their members. We look forward to working with the administration and the new head of the FDA to accomplish just that.

Do you have any questions about how you can help fight for lower prescription drug prices? Ask Us
May 18, 2017
Former Executive Vice President and Chief Operating Officer, CVS Health

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