PCMA President Mark Merritt Testifies before Senate Aging Committee,
PCMA President Mark Merritt’s Testimony (PDF FILE)
Complete Video of Hearing
Clip: Mark Merritt’s testimony
Clip: Senator Clinton remarks and Mark Merritt’s response:
PCMA Analysis Finds Potential Savings of $49 Billion Over Five Years
With 14 Brand-Name Drugs Losing Patent Protection
(Washington, DC)—Testifying today before the Senate Aging Committee, Mark Merritt, President of the Pharmaceutical Care Management Association (PCMA), highlighted pharmacy benefit managers’ role in promoting the use of generic drugs and urged Congress to act in four key areas to expand consumers’ and payors’ access to cost-effective and clinically proven generics drugs. PCMA is the national association representing America’s pharmacy benefit managers (PBMs), which administer prescription drug plans for more than 200 million Americans with health coverage provided through Fortune 500 employers, health insurers, labor unions, and Medicare.
“Regarding generics, PBMs do as much or more than anyone in America to increase generic utilization where appropriate, resulting in prescription drug spending slowing to its lowest growth rate in the past decade,” said PCMA President Mark Merritt. “However, additional opportunities are available, and policymakers should work to eliminate unnecessary barriers that keep generic alternatives from entering the marketplace.”
At the hearing, Mr. Merritt urged policymakers to act in four specific areas to increase generic utilization, including:
Support S. 2300, legislation sponsored by Senators Stabenow (D-Mich.) and Lott (R-Miss.) and close legal loopholes. Specifically, S. 2300 seeks to reform the Citizen Petition process; reduce the entry when patents are challenged in court; and provide an avenue for additional generic antibiotics through its reforms.
Create a legal pathway for generic biologics. Biologics are drugs to treat complex, chronic conditions and are extremely costly and remain so over a long period of time because of the lack of competition in the market. PCMA believes that Congress should address this issue and not wait until the cost of biologic drugs hits critical mass.
Increase funding for the Office of Generic Drugs. With a large backlog of generic drug applications pending, PCMA supports increased funding to resolve the backlog issue that will only worsen in coming years.
Create a national, uniform standard for electronic prescribing (e-prescribing). PBMs promote e-prescribing, which has great potential to improve quality and promote the use of generic alternatives. However, a patchwork of varying state e-prescribing laws — in addition to the new e-prescribing regulations contained in the Medicare Modernization Act Ă¢?? have created sometimes conflicting and duplicative rules. PCMA believes that the adoption of a national, uniform standard for e-prescribing laws would greatly encourage compliance by physicians and others and would lead to greater generic drug utilization.
Increased use of generic drugs has the potential to save both Medicare beneficiaries and the entire health system billions of dollars over the next five years. In April 2006, PCMA released an analysis examining the top 100 drugs used by seniors to arrive at a conservative estimate of potential cost-savings to Medicare and the entire health care system. PCMA found that 14 brand-name drugs commonly used by seniors to treat conditions such as high cholesterol, depression, heart disease, and hypertension are anticipated to go off patent or lose exclusivity during the next five years. Seniors and the Medicare Part D program could potentially save, at a minimum, more than $23 billion dollars over the next five years. When these savings are applied to the entire health care system, the potential savings increases to $49 billion over five years.
Independent government data have also demonstrated the cost-savings associated with increased generic utilization. This past January, researchers from the Centers for Medicare & Medicaid Services (CMS) found that prescription drug spending in 2004 slowed to its lowest growth rate in the past 10 years, rising 8.2 percent. Two of the chief reasons cited by CMS researchers for the slowdown in prescription-drug spending were increased use of lower-cost generic drugs and mail-service pharmacies.
###
PCMA is the national association representing America’s pharmacy benefit managers (PBMs), which administer prescription drug plans for more than 200 million Americans with health coverage provided through small businesses, Fortune 500 employers, health insurers, labor unions, and Medicare.
Contact Information:
Phil Blando 202-207-3614
Charles Coté 202-207-3605