A purchasing group's effort to expand its membership beyond hospitals is facing opposition from drugmakers.
Four drug companies have told Los Angeles-based Purchase Connection they don't want to extend price discounts to its new member, Corrections Corporation of America, because it isn't a healthcare facility. The issue is under discussion, said Charles Kirkpatrick, Purchase Connection's national sales director.
The companies are Allergan, Glaxo, Hoffmann-La Roche and Schering-Plough Corp.
Purchase Connection negotiates group contracts for 1,500 healthcare facilities. Manufacturers typically grant it prices 5% to 15% below those single facilities can negotiate, Kirkpatrick said.
Last year, 15 prisons and correctional facilities managed by Nashville, Tenn.-based Corrections Corporation of America enrolled in the group. They expect to spend up to $15 million under its contracts annually, about the same as a large hospital.
Prison clinics, like hospitals, help determine the drugs that physicians prescribe by setting formularies, so they ought to be eligible for the same discounts, Kirkpatrick said.