Earlier this week, the Wall Street Journal published an article, “Pharmaceutical Companies Buy Rivals’ Drugs, Then Jack Up the Prices,” discussing an industry trend that Express Scripts has been monitoring closely and actively addressing over the past few years.
Reporters Jonathon Rockoff and Ed Silverman outline the core issue:
- “More pharmaceutical companies are buying drugs that they see as undervalued, then raising the prices. It is one of a number of industry tactics, along with companies regularly upping the prices of their own older medicines and launching new treatments at once unheard of sums, driving up the cost of drugs.”
One of the examples the article highlights is Horizon Pharma’s attempt to sell its newly purchased product Vimovo® (naproxen and esomeprazole magnesium) at prices that far exceed the value it provides the healthcare system:
- “The price increases can be very lucrative for companies. Horizon Pharma PLC upped the price of Vimovo pain tablets after buying the rights from AstraZeneca in late 2013. On Jan. 1, 2014, its first day selling Vimovo, Horizon raised the list price for 60 tablets to $959.04, a 597% increase… Horizon raised the price again on Jan. 1 this year to $1,678.32 for the tablets.”
What’s described here isn’t pharmaceutical innovation. It’s profiteering. And it can’t be allowed if plan sponsors are to afford the breakthrough medications that patients truly need.
Aligned With the Interests of our Clients, Ready to Act
Express Scripts’ utilization management solutions protect plan sponsors and members from these very tactics. We closely track manufacturer price increases and take quick, decisive action to ensure that our clients are not paying more for prescription drugs that provide no additional health benefit.
Express Scripts is a leader in stopping these excessive price hikes.
For several years, Vimovo and a similar Horizon product Duexis® (ibuprofen and famotidine), have been in our Step Therapy Program. Last year alone, this program has lowered our commercial clients’ spend on these two products by $7.5 million. And in 98% of these instances, patients switched to a less-expensive, clinically equivalent over-the-counter medication.
This year, we have taken the additional action of excluding both Vimovo and Duexis from our 2015 National Preferred Formulary.
We have protected our clients even further by negotiating for future inflation predictability within our contracts with other brand-drug manufacturers. Currently, we have inflation caps for more than 150 of the most critical medications – those that represent more than half of our clients’ brand drug spend. Last year, the clients on our National Preferred Formulary saved more than $100 million because of the inflation predictability we were able to achieve on their behalf.
Manufacturer consolidation and egregious pricing demonstrate why plan sponsors need Express Scripts. We are completely aligned with our clients’ interests and always take the necessary actions to make the pharmacy benefit more affordable and sustainable.
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