Ensuring Drugs Are Clinically Superior and Competitively Priced

Nov 26, 2014
As Bloomberg recently highlighted, Express Scripts’ formulary management solution drives competition among drug manufacturers and ultimately makes prescription drugs more affordable.

In an article yesterday, Bloomberg News highlighted how rising price hikes for medications are pushing the limits of what’s affordable for American payers – employers, unions, health plans and government. In response to this unsustainable trend, payers are excluding coverage for expensive medications that don’t add clinical value.

In particular, Bloomberg notes Express Scripts’ approach to formulary design is helping to make prescription drugs more affordable for its clients and patients. By being willing to exclude a portion of clinically equivalent products from our formulary, we have leverage to negotiate more effectively with manufacturers and ultimately achieve lower drug prices for the clients and patients we serve.

This formulary management solution will save our clients more than $1 billion in 2015.

Unwarranted Rx Price Hikes

As quoted in the article, Express Scripts' Chief Medical Officer Dr. Steve Miller warned of the impact of future price increases:

  • “Unless more is done about a wave of new and expensive drugs, some priced at as much as $50,000 a month…health plans are going to be swamped as costs double to half a trillion dollars as soon as 2020.”

And Dr. Glen Stettin, Express Scripts’ Senior Vice President of Clinical, Research, and New Solutions, summarized how our formulary philosophy pressures drugmakers to provide better prices for our clients:

  • “Drug companies that think they can charge whatever they want in competitive categories run the risk of being excluded.”

Today, with more therapy classes offering more drug choices, new medications must demonstrate value. If pharmaceuticals aren’t clinically superior or competitively priced, health plans are less likely to cover them.

  • “If they keep raising prices, drug companies ‘face an increasingly ugly backlash from plan sponsors,’ Express Scripts’ Miller said. The company only excludes drugs when there are clinical equivalents available.”

By driving competition among drug manufacturers, Express Scripts works to make prescription drugs more affordable and ultimately take billions out of the healthcare system.

Read the full Bloomberg article.

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Lab Staff
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