Wednesday, April 25, 2018

The role of PBMs in the drug supply chain — and why it matters to employers

Most employers don’t understand how PBMs make money and what role they play in the drug supply chain. The fact is these “middlemen” can drive up pharmacy costs. Historically, PBMs have two main goals:

1. Negotiate drug prices in an effort to keep costs low for consumers and employers.

2. Favor the most effective drug where there are similar drugs treating the same condition.

But PBMs also have a third goal: to make money for their owners and shareholders. Arguably this goal overrides the other two. Many industry watchers — and members of the public — are wondering if PBMs provide much value other than skimming as much profit from the drug supply chain as possible.

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