Decoding Rebates: Study Highlights Need for Further Research into Drug Pricing, Employer PBM Choices

In the second part of our interview on his recent study published in the American Journal of Managed Care^® (AJMC^®), "Prescription Rebate Guarantees: Employer Insights," John M. O'Brien, PharmD, MPH, president and CEO of the National Pharmaceutical Council (NPC), discusses the potential impact of its limitations and areas for further research.

He also highlighted how the study's findings tie into the recent conversation surrounding pharmacy benefit managers (PBMs) and drug rebates, gaining the attention of Mark Cuban, co-founder of the Mark Cuban Cost Plus Drug Company.

This transcript has been lightly edited for clarity.

Transcript

What do your findings add to the ongoing public discourse on PBMs and drug rebates?

The findings of this research underscore what we've been hearing from leading voices like Mark Cuban, Greg Baker, Adam Fine, and Jonathan Levitt. Employers should learn more about how this system works and not let rebate guarantees cause them to make bad choices for their employees.

It also adds to the research relevant to the investigative journalism of veteran reporters like Bob Herman, Reed Abelson, and Rebecca Robbins. Employer benefits consultants aren't well known, but they play an outsized role in the benefits employers offer to patients and how that affects what people pay at the pharmacy counter. They're taking together all of these things to give policymakers more to consider as they propose reform.

Could you discuss your study's limitations? How did they potentially impact your findings?

First of all, this is a survey, so it measures how people respond to a survey, not what they actually do. We didn't hear back from everyone who received the survey, nor do we have visibility into the confidential agreements signed by the employers who did respond.

But this is the first research of its kind, and I hope it encourages more research into a key finding, which is why employers say they prefer transparency but instead end up choosing rebate guarantees when we know these rebate guarantees can obscure transparency into the prices they're actually paying and getting the information they really want.

What should future research focus on to build upon your findings regarding rebate guarantees and the role of employer benefit consultants and brokers in PBM selection?

There's 2 other research opportunities that our research hopefully encourages. AJMC^® has published work from many respected researchers to illustrate the link between incentives and choice.

So, more research into why employers make the PBM choices they do and how it affects employees will go a long way in building better benefits or creating policies that lead to lower out-of-pocket costs and better health outcomes for their employees.

Secondly, another part of the system that isn't well understood yet is the group purchasing organizations, or offshore GPOs as they're sometimes referred to. So, more research to clarify the role they play in all of this can help shed more light on a shadowy and opaque system that may not be helping patients.