Top solutions to lower drug prices


PBMs partnering with pharmacies and drug makers may have a solution to nonadherence due to high pharma costs.

When two pharmacy benefits managers (PBMs)-Express Scripts and CVS Health-recently launched direct-to-consumer, drug discount cards, the pharmacy industry might have wondered if these pharmacy middlemen were trying out a new role.

Discount cards are certainly not an anomaly in pharmacy, but they are less common when sponsored by PBMs and marketed directly to consumers. Pharmacies, such as Walmart, and many drug manufacturers have offered discount drug cards and coupons for years.

Blink Health, for example, offers one year of free prescriptions for metformin, glipizide, and pioglitazone to anyone creating an account on its website. It also has partnered with Eli Lily, offering a 40% discount on the manufacturer’s insulin, including Humalog, an insulin patient access program.

In 2013, Medipact acquired ScriptSave, a PBM offering consumer-focused pharmacy loyalty programs. Consumers can expect an average savings of 45% and up to 80% on brand and generic prescription drugs regardless of insurance status. More than 62,000 pharmacies across the country accept the card, with no limits on its use.

The two new drug discount cards that partner with pharmacies and manufacturers align with the high rate of patients who don’t take their medications due to their high costs. More than 125,000 deaths and up to $300 billion are attributed annually to nonadherence to medication, according to a study published in the Annals of Internal Medicine. In addition, many brands are unaffordable for the 30 million who pay cash for medications.

Next: Reduced insulin rates



CVS Caremark offers reduced insulin rates

Since 2006, CVS Caremark has offered the EasyDrugCard, which provides savings on prescriptions at all of its retail stores. This year, CVS Health created Reduced Rx, a prescription savings program that offers discounts on certain medications directly to patients through CVS Health's pharmacy benefits manager, CVS Caremark. The program will help patients with high out-of-pocket costs afford essential medications.

The program targets those without health insurance, the underinsured who might have a drug that is not covered by a plan, and people with high-deductible plans. Medication costs, however, will not count toward a deductible or maximum out-of-pocket expense.

The program only covers Novo Nordisk’s Novolin, an insulin, and cannot be used with any insurance.

“We developed the Reduced Rx prescription savings program with Novo Nordisk because we both recognized a need and an opportunity to make critical medications more affordable for patients.  Our belief is that significant numbers of patients with diabetes could benefit from this program,” says a CVS Health spokesperson.

“As one of the largest drug purchasers in the U.S. healthcare system, we employ industry-leading strategies to encourage more competitive pricing, reduce trend, and make drugs more affordable and accessible for patients who need them,” the CVS spokesperson says.

Tom Borzilleri, CEO of InteliSys Health, a software technology company based in San Diego, says the rising cost of insulin is scaring patients with diabetes and often make the medications unaffordable. The average price of insulin almost tripled between 2002 and 2013, according to the American Diabetes Association

Consumers may purchase a 10 mL vial of the insulin for $25 through the program at 67,000 pharmacies in the CVS Caremark retail network, including more than 9,700 CVS pharmacies nationwide. That represents a potential savings of up to $100 for a patient paying out of pocket. CVS Health intends to expand the Reduced Rx prescription savings program to other medications and to address other conditions. 


Borzilleri believes that despite the drug discount card, many consumers will probably pay more for the drugs than they should. 

He says prices for most of the drugs discounted on new PBM cards are competitive, so the new prescription programs are seen as a means of differentiating one PBM from another. “These cards are built upon loyalty,” he says. “Cards have generated billions for PBMs and marketers-passing savings onto customers without affecting PBM profit margins.”

According to CVS, the PBM is able to offer a lower price through its discount card because it is working closely with pharmaceutical manufacturers that are committed to providing more affordable medications to the people who need them. Pharmaceutical manufacturers will assume a portion of the cost of the prescription medication dispensed under the program.

According to CVS Health, the creation of Reduced Rx in May comes on the heels of a January announcement that the company, working with Impax Laboratories, has made the authorized generic for Adrenaclick, an epinephrine auto-injector for patients with allergic reactions, available at all CVS Pharmacy locations at the lowest cash price in the market-$109.99 for a two-pack.

Borzilleri sees a consolidation of the drug discount card market and PBMs, with the latter working with marketing companies to push their cards to consumers. “Companies are pitting one card against another to offer the lowest possible prices, which are presented through a mobile app,” he explains.


“There are about 20 different independent discount cards not affiliated with an insurer, so these new direct-to-consumer offerings present a way for PBMs to orchestrate their own programs,” says Wayne Dix, vice president, SSA & Company, a management consulting firm.

“PBMs are competing with existing cards and with manufacturers’ direct-to-consumer coupons to earn increased revenue for manufacturers and themselves,” he says. “They are trying out the concept to see how the market reacts. OptumRx is well-positioned to offer a direct-to-consumer, drug discount card because of its relationship with UnitedHealthcare if it’s not too much of a financial risk. The new cards also empower consumers with more options.

“If the cards can make drugs more affordable and increase compliance, that is the right endgame,” Dix says.

Next: Target multiple drugs



Targeting multiple drugs

Similar to CVS, Express Scripts leverages its independence, scale, and size to negotiate rebates on drugs, which are passed directly to consumers in the form of a discount at the point of sale.


“Inside Rx opens a new market for Express Scripts that has not been previously addressed,” says Leslie Achter, CEO of Inside Rx, a partially owned subsidiary of Express Scripts in partnership with GoodRx, a drug discount program. “Our traditional role is playing intermediary between manufacturers and primarily health plans and employer groups. Our goal is to combat high prices for those who need it the most-new patients who are either uninsured or underinsured.”

Users, however, cannot be insured under Medicare, Medicaid, Tricare, or other state- or federally-funded benefit plans, nor can they combine the discount cards with any insurance benefit, copayment assistance program, or other third-party, financial benefits.

Individuals can download and/or print the card from They bring this card and their prescription to one of the 40,000 participating pharmacies, including CVS, Albertsons, Walgreens, and Kroger, and pay for 30-day supplies of more than 40, mostly branded medications for diabetes, asthma, COPD, depression, allergy, gastrointestinal conditions, gout, and heart health-categories Achter says are the most highly utilized and costly. The offerings include Nexium, fluticasone propionate, Spiriva, and Crestor. Inside Rx plans to add more drugs to the program.

When the card was first launched May 8, 2017, individuals saw an average of a 34% discount on a drug’s typical cash price; now that has risen to 40%.

Inside Rx works with eight manufacturers, including Sanofi, Takeda Pharmaceuticals, Teva Pharmaceuticals, Eli Lilly and Boehringer Ingelheim, to negotiate prices on behalf of 20,000 consumers for broad access. Among the 43 products the cards cover is Humalog, an insulin lispro injection, which can be purchased at a 50% discount. The cards have resulted in a savings of $1.3 million.

“CVS and Express Scripts have made deals directly with select brand drug manufacturers, and their new programs will be limited to a narrow selection of high-priced drugs,” Borzilleri says. “This is a strategy to disrupt the copayment assistance from marketing companies in which Express Scripts and CVS receive the brunt of the rebates and brand incentives that are normally paid to the marketing companies to perhaps lower prices further and increase profits by knocking out the middlemen.” 

Next: Discount cards vs. coupons



Discount cards vs. coupons: are they different?

“The new offerings from Express Scripts and CVS do not differ too much from what Medimpact is doing with ScriptSave. They are just revitalizing an old model. There is still the ingredient spread that increases the price of these medications,” says Borzilleri.

“The primary difference is that the drug discount cards MedImpact/ScriptSave has been marketing both directly and through a number of marketers over the last eight-plus years provided discounts on its entire formulary of both brand and generic drugs and not just select drugs in specific therapy classes,” he says.

In addition, Borzilleri points out, the program is Express Scripts’ first foray into the drug discount card market; it only supported funded programs in the past and never touched cash programs.

Achter emphasizes that Express Scripts’ new drug discount card is different from traditional drug manufacturers’ coupons:

·      Inside Rx leverages Express Scripts’ purchasing power to negotiate with manufacturers and achieve point-of-sale discounts on select medications.

·      Unlike traditional drug manufacturer copayment cards that are for one drug, Inside Rx provides point-of-sale discounts for more than 40 brand and generic medications.

·      Copayment cards traditionally are for people with insurance, whereas Inside Rx can be used by anybody-especially for those who are uninsured. “This is important because it gives people, who need it most access to affordable medications,” she says.

·      There is no expiration date, and the card can be used over and over.

On the other hand, CVS marketed its own card program, which required an annual fee of $20 to receive a discount off of its usual and customary price if a customer had no insurance or prescription coverage. “This program enabled CVS to earn the ingredient spread that the PBMs were absorbing as profit when CVS filled prescriptions under the drug discount programs that were administrated by companies such as MedImpact/ScriptSave,” Borzilleri says.

He also notes that pharmacies really don’t like discount card programs, but are forced to honor them or run the risk of losing a PBM’s funded business. “They are working on ways to shift the billion dollar profits made by PBMs to themselves,” he says.


Mari Edlin, a frequent contributor to Managed Healthcare Executive, is based in Sonoma, California.


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