Drug chains, ASHP Support Anti-Price Gouging Campaign

May 3, 2017

A new campaign takes aim at drug prices, but is it the right approach?

Walmart, CVS Health, the American Society for Health-Systems Pharmacists, and a number of other health-care organizations are supporting a new multimillion dollar consumer ad campaign to combat high prescription drug prices.

The Campaign for Sustainable Rx Pricing (CSRxP), a coalition of companies and groups that also includes AARP, the American Hospital Association, and the American Academy of Family Physicians, launched the nationwide campaign on May 2 with the goal “to hold Big Pharma accountable for their out-of-control prescription drug prices,” the group said in a statement.

CSRxP debuted the first in a series of nationwide advertisements, “PriceGougi$ol,” on broadcast and cable television. The ad will run in Washington, DC, and in the districts of key lawmakers around the country. The ads highlight the “hypocrisy of Big Pharma’s claims that out-of-control prescription drug prices are necessary to fund research and development,” CSRxP said. “The truth is, nine out of 10 of the biggest drug manufacturers in the United States spend more on advertising than they do on R&D,” the group said.

“ASHP members have identified this as a huge problem and a growing burden on hospital pharmacy budgets,” Joseph Hill, Director of ASHP’s Government Relations Division, told Drug Topics. “The new advertising campaign is a way to reach consumers directly and let them know this is a significant problem and that they’re not alone.”

“Pharmacists have a unique perspective on the crisis caused by out-of-control prescription drug prices,” said Will Holley, a spokesman for CSRxP. “Every day, they work with patients who are hurt by Big Pharma's price gouging-whether that's the 500% increase in EpiPen prices, or companies like Marathon whose business model is based on abusing systems designed to promote innovative treatments for rare diseases, to raise prices for those once-affordable medications to an unaffordable level.”

However, the Pharmaceutical Research and Manufacturers of America (PhRMA) denounced the ad campaign. “Rather than offering solutions, this advertisement makes light of the real challenges patients are facing when trying to access the health care they need,” Holly Campbell, Senior Director of Public Affairs for PhRMA, told Drug Topics. “We believe the focus should be on advancing common sense, practical solutions that bring down health care costs and lower out-of-pocket costs for patients.”

Related article: Business Group Makes Price Recommendations for Specialty Drugs

While PBMs “will go to great lengths to defend their practice of charging patients higher out-of-pocket costs while increasingly benefiting from the growing discounts and rebates negotiated with biopharmaceutical companies,” Campbell said, the reality is that drug companies invest at least 10 times more in R&D than direct-to-consumer advertising.

“On average, biopharmaceutical companies invest 20% of their revenue in R&D-far more than any other industry in the U.S. economy,” Campbell said.

In addition, pharmaceutical companies retain just 63% of the list price of a medicine with more than a third being rebated back to insurance companies, PBMs, and the government, Campbell said.

Because of aggressive competition and negotiation in the marketplace, PBMs’ spending on medicines increased by only 3% or 4% in 2016-in line with overall health care cost growth, she added.