PhRMA launches new ad in campaign exposing ways middlemen drive up costs

You’ve probably heard by now that middlemen are driving medicine costs, but you don’t know the half of it.

That’s the theme of new advertisements launched today by PhRMA in our ongoing campaign highlighting the ways middlemen, like pharmacy benefit managers (PBMs) and health insurance companies, use medicines as a profit center while driving up costs for patients and the health care system.

PBMs and health insurers decide what medicines you can get, and they set the price you pay at the pharmacy. At the same time, over half of every dollar spent on medicines goes to these middlemen and others.

To make matters worse, PBMs and health insurers are owned by the same massive health care conglomerates and also own pharmacies. And, they are further consolidating their control over the health care system, allowing them to extract more profits.

Our new ad focuses on these themes using the now-prominent “middleman” as a PBM and a health insurance company. The middlemen decide to charge a patient more for their medicine at the pharmacy and then take their cut of the profits.

Today’s announcement falls on the heels of groundbreaking investigations from the New York Times, Wall Street Journal and Federal Trade Commission detailing how the PBM industry is focused on profits at the expense of patients, community pharmacies, employers and others.

This effort also makes clear: policymakers can’t address medicine costs if they don’t take on the middlemen. So, it shouldn’t be a surprise that a new Morning Consult/PhRMA poll shows the vast majority of Americans are not only concerned about the harmful practices from PBMs and health insurers, they want policymakers to act.

In fact:

• 82% of Americans are concerned that over half of every dollar spent on medicines goes to PBMs, payers and other stakeholders, not the companies who made them.
• 81% are concerned that PBMs influence what medicines patients get and control what patients pay at the pharmacy.
• 84% agree policymakers should focus on cracking down on abusive practices by health insurance companies and other middlemen that make it harder to get the care they need. 
• 80% of Americans favor requiring health insurance companies and their middlemen to pass the rebates and discounts they receive directly to patients at the pharmacy counter, so no patient has to pay more for their prescription medicines than their insurance company.
• 72% favor requiring middlemen to be paid based on the services they provide instead of the price of a medicine, fixing the potential incentive for middlemen to favor high-priced medicines.

Our campaign adds to the growing chorus of voices, including pharmacies, providers, employers, AARP and others, calling on policymakers to help patients by taking on the middlemen.

That starts with ensuring savings are passed on to patients, requiring PBMs to be paid a flat fee not based on a medicine’s list price and holding PBMs accountable for their abusive practices that put medicines out of reach for patients.