by Mark Merritt
Posted 1/13/2014 12:00 am
Arkansas Business’ interview with drugstore lobby chief Mark Riley (Executive Q&A, Dec. 16) begs the question of why employers hire pharmacy benefits managers, or PBMs, instead of simply contracting directly with drugstores.
Mr. Riley suggests that employers just aren’t as savvy as drugstore owners like him.
While it’s true that local drugstores hire sophisticated Fortune 500 drug wholesalers to negotiate on their behalf, the real answer is very simple. PBMs reduce employers’ pharmacy costs by 25 percent by negotiating large discounts on medications from drugstores and drug companies.
Under the guise of “PBM reform,” the drugstore lobby is pushing new mandates to make it harder for employers and PBMs to reduce drug costs.
Unfortunately, that strategy only profits drugstore owners at the expense of all the other businesses in their community.
President and CEO
Pharmaceutical Care Management Association