Drug Price Transparency Takes a Coalition


Joseph M. Shields talks about the formation of Transparency-Rx and its goals of achieving PBM reform that focuses on “corrective steps to address the misalignment in the marketplace to ensure that there’s competition and choice.”

Joseph M. Shields

Joseph M. Shields

Bringing transparency to drug pricing is Joseph M. Shields’ mission. As managing director of Transparency-Rx, a recently launched coalition of PBMs, Shields and organization’s PBM members aim to shine a light on the drug pricing policies that lead to higher costs.

“The drug pricing debate was always responded to refrain by either AHIP (formerly America’s Health Insurance Plans) or PCMA (Pharmaceutical Care Management Association),” Shields said in an interview. “This didn’t seem to resonate with the companies and PBMs I was doing business with.” Shields is also a founder of a consulting and public relations company with experience working on Capitol Hill.

Shield started to have conversations with PBMs at the beginning of 2023 about possibility of forming a coalition of PBMs. At the time, Congress was holding hearings about improving transparency and accountability in the PBM industry.

“It was pretty clear that a single company with a single voice just wasn’t going to move the dial much on Capitol Hill,” Shields said. This led to discussions with other companies to an advocacy organization to advance more transparent solutions for drug benefits.

Transparency-Rx launched in September 2023 with six members — Affirmed-Rx, Liviniti (formerly Southern Scripts), MedOne Pharmacy Benefit Solutions Rx, Navitus Health Solutions, RxPreferred Benefits, and Smith Rx. In December 2023, Pharmacy Benefit Dimensions joined the organization, and Shields said another member is about to come on board.

The organization supports PBM reform that includes:

• 100% pass-through model of drug prices from the pharmaceutical company to plans and employers;

• a ban on spread pricing to compensate PBMs;

• a national reporting and disclosure requirements for the PBM industry and its consultants;

• “Delinking” provisions, which would require PBMs to be paid by a flat, disclosed fee;

• Rebate reform that also includes group purchase organizations (GPOs).

Transparency-Rx also supports using technology to gather actionable data and information that is shared with patients, plans, pharmacists, and physicians. “This is a coalition led by transparent PBMs with affordability as a core value and mission,” Shields. “Most of the things Congress is contemplating is probably already reflected in the business models of these companies.”

In 2024, he said in the short-term the goal of Transparency-Rx is to see that Congress passes comprehensive PBM reform. “We support more than reporting or the disclosure requirements,” he said. “We want to see corrective steps taken to address the misalignment in the marketplace to ensure that there’s competition and choice.

The three big PBMs — CVS Caremark, Express Scripts, and OptumRx — control 80% of the PBM market.

Shields hopes to see movement in Congress this year on PBM reform. “There’s wide bipartisan support on the core issues that include the commercial sector.”

In the most recent efforts at reform, the Senate Finance Committee passed broad legislation that would introduce more transparency and regulation to PBMs, and pharmacies would be required to report costs for medications. The act would essentially be paired with provisions in the Modernizing and Ensuring PBM Accountability Act, which passed earlier this year.

Shields also pointed to support from House Committee on Oversight and Accountability Chairman James Comer for “delinking” PBM compensation from drug prices, rebates or discounts.

Related Videos
Related Content
© 2024 MJH Life Sciences

All rights reserved.