Winfield’s Dared Price, owner of Price Pharmacies, which includes Graves Drug, spoke at the White House in Washington, D.C. Monday.
Price, who is also on the National Community Pharmacists Association Board of Directors, was part of a White House Roundtable Discussion titled, “Lowering Healthcare Costs and Bringing Transparency to Prescription Drug Middlemen.”
Price discussed the struggles rural community pharmacies face when it comes to drug costs, decreasing reimbursements and the lack of negotiating power and control such pharmacies experience when dealing with large corporate pharmacy benefit managers, or PBMs — companies that manage prescription drug benefits on behalf of health insurers.
Examples of PBMs include Caremark (CVS Health), Express Scripts (Cigna), and OptumRx (UnitedHealth Group) — known as the “big three” in the PBM industry.
Price told the roundtable he wears two hats — that as the owner of a pharmacy and vice president of Oread RX — what he described as a small, regional transparent pass-through PBM built by independent Kansas pharmacies.
“Three PBMs control 80 percent of the market place,” Price said. “They don’t have to negotiate with us, so they don’t negotiate with us. They are putting us out of business with underwater reimbursements, period.
“As an example, in my seven rural pharmacies in Kansas, we did an analysis on the GLP 1 therapeutic category of drugs. These drugs are used in diabetics and can most of the time can be life-altering for people. By filling these meds, my pharmacies were reimbursed $12,000 under my acquisition costs in January alone of this year.
“If you extrapolate that over a year, that’s $170,000 loss for one class of medication in my small pharmacies in Kansas. Unfortunately, this is indicative of most brand and specialty reimbursement for community pharmacies today. As a result, pharmacies are losing money on many of the prescriptions they fill — especially in the Medicare Part D space. In my business alone, 40 percent of the total of Medicare Part D prescriptions that I fill are paid below my costs. It’s simple math. We can’t stay in business being paid less than their costs.
“HHS (United States Department of Health and Human Services) and CMS (Centers for Medicare & Medicaid Services) can and must enforce regulations already in place regarding reasonable and relevant contract terms in the Medicare Part D space.”
Price, who said the large PBMs often own the insurance company, try to protect their size and control with the fear of rising premiums if faced with reform.
“Fair payments to providers also aren’t increasing premiums,” he said. “States that have passed PBM reform, like Kentucky, that allow for fair payments to pharmacies, have not seen higher costs — they’ve seen exactly the opposite.”
Price shared that in 2022, Oread RX helped save the Winfield school district significant costs by dumping one of the big three PBMs for prescription drugs.
“For example, Oread RX helped save a local school district $450,000 annually when they switched from one of the big three PBMs. This was a decrease in their drug spending of 50 percent.
“So this lie that if we pay pharmacies fairly that it’s going to increase premiums is a lie. We can do that because unlike the other big three PBMs the rebate we receive we pass 100 percent of that rebate to the plan. We provide all of these savings while paying pharmacies in our network fairly.
“If PBMs were required to be transparent and work with local pharmacies instead of trying to kill us off, the healthcare industry would not only see real savings, but also better outcomes.”
Price’s comments were echoed by Mark Cuban, who was also a panelist on the roundtable.
Cuban, the Dallas Mavericks NBA team owner and “shark” investor of TV’s Shark Tank, recently started Cost Plus Drug — a direct-to-consumer pharmaceutical venture aimed at disrupting generic pharmaceutical pricing.
“There is not a single thing that those big three PBMs do that is unique, or can’t be replaced by Dr. Price’s company, or any other independent rebate-avoiding PBM — not a single thing,” he said. “The biggest three PBMs will make you think that they are so big that if you don’t work with them, everything will collapse, like Dr. Price (said), and nothing can be further from the truth.”
