Michael Thompson on Employer-PBM Relations and What It Will Take to Change Them

In an interview after he spoke at the 2023 PBMI Annual National Conference in Orlando last week, Thompson said the pharmacy benefit manager (PBM) practices have evolved to take advantage of employers partly because the stakes used to be much smaller and have gradually become much larger.

“When drugs cost $50, if you wasted a drug here and there, it wasn’t the end of the world. It wasn’t going to break your bank. Now you are talking drugs that cost $20,000, $20,000, $2 million,” said Thompson. “And the people who are minding the store aren’t working for you (the employer). They are working for them (the PBMs). That’s a problem.”

In June 2023, Thompson’s organization published a guide to PBM contracting for employers titled “ A Playbook for Employers – Addressing Pharmacy Benefit Management Misalignment.” Thompson, who is retiring at the end of this year, said he saw this as opportune time for the employer-PBM relationship to change.

“This is the beginning of a change process,” he said. “I think this is the year, in light of the FTC (Federal Trade Commission) investigations, the legislation, the new players. We think this is the time to actually effect change in the industry and get the pivot in terms of how purchasers are thinking about dealing with their PBM partners.”