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NCPA to Congress: Look into rising cost of generics
January 8th, 2014
ALEXANDRIA, Va. – The National Community Pharmacists Association has called on Congress to hold a hearing on the soaring cost of many generic drugs.
NCPA said Wednesday that it has sent a letter to leaders of the Senate Health Education Labor & Pensions Committee and the House Energy and Commerce Committee that urges lawmakers to examine the issue, which the association spotlighted in a recent survey.
Pharmacy acquisition prices for numerous generics have surged by as much as 600%, 1,000% or more, the NCPA poll of over 1,000 community pharmacists found. The survey also revealed that patients are declining their medication because increased co-payments, or total costs for the uninsured, and that the trend has pushed more seniors into Medicare's "doughnut hole" coverage gap, where they must pay more out-of-pocket costs.
"Over the last six months, I have heard from so many of our members across the U.S. who have seen huge upswings in generic drug prices that are hurting patients and pharmacies ability to operate," NCPA chief executive officer B. Douglas Hoey wrote in a letter to the Senate and House committee leaders, Sens. Tom Harkin (D., Iowa) and Lamar Alexander (R., Tenn.) and Reps. Fred Upton (R., Mich.) and Henry Waxman (D., Calif.).
"We respectfully request that you schedule an oversight hearing to examine what factors might have led to these unmanageable spikes in generic drugs and what steps can be taken at the federal level to alleviate the burden that has been placed on our members and the patients they serve," Hoey stated.
Key findings of the NCPA survey included the following: 77% of pharmacists reported 26 or more instances over the past six months of a large upswing in a generic drug's acquisition price; 86% of pharmacists said it took the pharmacy benefit manager (PBM) or other third-party payer two to six months to update its reimbursement rate (but not retroactively); patients may be referred to other pharmacies because the community pharmacy couldn't absorb losses of $40, $60, $100 or more per prescription filled because of inadequate and/or outdated reimbursement rates; and 84% of pharmacists said the unsustainable losses per prescription are having a "very significant" impact on their ability to remain in business.
Also this week, NCPA gave its take on policy changes proposed by the Centers for Medicare & Medicaid Services (CMS) for Medicare Part D prescription drug plans in 2015.
In comments released Tuesday, the association said it's encouraged by CMS' response to issues with preferred pharmacy networks.
"CMS' proposal to allow any willing pharmacy to offer a plan's lowest, or 'preferred,' cost-sharing should help level the playing field for community pharmacies to participate in these plans and should benefit seniors by giving them more competition and choice among pharmacies in their drug plan," NCPA stated.
The association also applauded CMS' efforts to address concerns about maximum allowable cost (MAC) pricing, especially in light of the escalating costs for certain generic drugs.
"Giving community pharmacists both greater transparency into the MAC-setting process and more assurance that MACs should be updated frequently to reflect real-world costs is the least that prescription drug plans should do," NCPA said.
NCPA, too, endorsed CMS' move away from co-pay arrangements that encourage the use of mail order over retail pharmacies. The association noted that research using Medicare data shows that community pharmacies offered 90-day supplies of medication at a lower cost and that community pharmacists did a better job of promoting the proper use of cost-saving generics.
"In addition, we commend CMS for proposing to expand coverage of medication therapy management (MTM) services," NCPA added. "And we thank the agency for recommending a prohibition on reimbursement methods, such as pro-rated dispensing fees, that penalize long-term care pharmacies for adopting dispensing techniques that are intended to reduce medication waste."