Are the drugs excluded from formularies by pharmacy benefits managers really no better than what's available at a cheaper price?
Researchers at Tufts University recently charged PBMs may be selecting medicines for their formularies based on manufacturers' willingness to offer rebates on those drugs. “Cost-effectiveness does not appear to correlate with exclusion status,” said Joshua Cohen, a health economist at Tufts' Center for the Study of Drug Development, which receives 35% of its funding from drug companies or their service providers. The “rebating mechanism … is not necessarily value-based—that is, clinical and cost-effectiveness does not drive decisions to exclude or recommend products.”
The number of drugs on the exclusion lists of the two largest pharmacy benefit managers in the U.S., CVS Health and Express Scripts, has grown about 65% from 2014 to 2016. In a study published this year, the Tufts center compared drugs excluded from their formularies. No comparative clinical or cost-effectiveness studies had been conducted for 10 of 16 drugs excluded by both PBMs, the study said.
The two PBMs disputed the Tufts findings. David Whitrap, senior director of corporate communications at Express Scripts, said his PBM's external Pharmacy & Therapeutics Committee of independent physicians must approve all exclusions and that group is not allowed to consider the price of the drug in its review.
Whitrap said the committee concluded that 15% of all medications on the market are clinically superior to all other available therapies. He said clinical benefits are given priority so these drugs are included regardless of price.
“For the other 85% of products … the committee provides Express Scripts with the flexibility to negotiate with the manufacturers of those similar products to see which will provide our clients the best net price—the combination of list price and rebate,” he said.
Christine Cramer, senior director of corporate communications at CVS, said: “It is important to keep in mind that the study authors did not have access to information about the negotiated prices that our clients pay for drugs on our formularies. The drugs included on our formularies are always more cost-effective than the alternatives that are excluded.”