NCPA urges more scrutiny of generic drug pricing

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ALEXANDRIA, Va. — In tandem with a congressional hearing, the National Community Pharmacists Association called on lawmakers to take a closer look at recent generic drug price hikes and their impact on patients and community pharmacists.

On Wednesday, the Senate Special Committee on Aging held a hearing titled “Sudden Price Spikes in Off-Patent Drugs: Perspectives from the Front Lines” to gain insight into the causes of generic drug price spikes and their effect on patients’ access to medication.


B. Douglas Hoey

NCPA said that according to a 2015 survey of independent pharmacists, the generic price jumps have not abated since a previous pharmacist survey was conducted in 2013. Pharmacists have reported instances of generic drugs that had soared by as much as 600%, 1,000% and even 2,000% in some cases.

Many pharmacists responding to the 2013 and 2015 NCPA surveys reported instances in which Medicare Part D beneficiaries, because of sharp prices swings, were refusing to refill their medications or planning to take less than the prescribed dose of their medication in order to “stretch” their remaining supply and avoid having to go into the donut hole, the association noted.

NCPA is urging Congress to enact legislation to foster transparency and ensure reimbursement rates paid to pharmacies reflect actual market costs.

“Generic price spikes are negatively impacting patients, pharmacists and health care payers alike,” NCPA chief executive officer B. Douglas Hoey said in a statement. “Importantly, the associated slow and low price adjustment on generic medications is wreaking havoc on the ability of small-business pharmacies to remain viable and continue to provide critical medications and related care to patients. We commend Congress for conducting this hearing and urge lawmakers to take additional steps for increased transparency and adequate pharmacy reimbursement.”

For policymakers, NCPA also shed some light on factors behind the generic cost hikes. Pharmacy benefit managers (PBMs) continue to adjust generic prices slowly and make low adjustments without reimbursing pharmacies retroactively, the association said. This is particularly troubling, NCPA explained, since PBMs have “teams of people to examine and review MAC lists,” according to the testimony of a PBM executive at a Nov. 17 hearing of the House Judiciary Committee Subcommittee on Regulatory Reform, Commercial and Antitrust Law.

That situation has led the Centers for Medicare & Medicaid Services (CMS) to consider maximum allowable cost (MAC), a drug pricing standard, and require PBMs to update prices on a frequent basis in Medicare Part D starting in the 2016 plan year, NCPA pointed out. CMS has stated in formal rulemaking that MAC pricing transparency and frequent updating is needed to ensure costs submitted by PBMs to CMS are accurate up front and don’t have to be adjusted later on, according to the association.

NCPA added that CMS also requires this transparency to make sure data on the Medicare Plan Finder is accurate, yet this rule doesn’t address any of the other federal health care programs. As a result, NCPA said it’s urging support for H.R. 244, a bipartisan bill that would require the same timely updates to MAC pricing in the Federal Employees Health Benefit Program and the military’s TRICARE program.



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