Harvard Analysis of 670 Million Prescription Drug Claims Finds Generic Dispensing & Substitution Rates Essentially Same at Retail & Mail-Order Pharmacies

Washington, DC; 01.13.05 — Comments made yesterday by Walgreens’ senior leadership about generic-drug dispensing and substitution rates at mail-order pharmacies and published in today’s Chicago Tribune are flat-out wrong, the Pharmaceutical Care Management Association (PCMA) said today. PCMA is the national association representing America’s pharmacy benefit managers (PBMs).

“Walgreens is flat-out wrong,” said PCMA President Mark Merritt. “According to a peer-reviewed analysis of 670 million prescription-drug claims by Harvard Business School, mail-service pharmacies dispense and substitute generic drugs at essentially the same rate as retail pharmacies. Moreover, mail-service pharmacies do so more cost-effectively than retail pharmacies and will save American consumers and employers $100 billion on prescription drug costs over the next decade.”

In July 2004, an independent peer-reviewed analysis of 670 million prescription drug claims by Harvard Business School economists concluded that generic drug-dispensing rates and generic substitution rates are essentially the same at retail and mail-order pharmacies. The analysis â?? which was independent and not funded by the PBM industry â?? was conducted by Marta Wosinska, Ph.D., and Robert Huckman, Ph.D., of the Harvard Business School and was posted on Health Affairs website on July 28, 2004.

The Harvard Business School analysis examined 670 million prescription drug claims processed by five large PBMs during the first six months of 2003. The analysis compared generic drug dispensing and substitution patterns at PBM-owned mail-service pharmacies versus retail pharmacies. In a fundamental difference from retail-pharmacy funded studies, this analysis adjusted for “therapeutic mix.” In plain English, the Harvard analysis takes into account the differences in the types of drugs consumers seek at mail-service pharmacies versus retail pharmacies. In the retail pharmacy setting, consumers typically seek prescriptions for acute conditions, whereas mail-service pharmacies are more likely to dispense prescriptions treating chronic conditions. The authors assert that this “therapeutic mix” adjustment is essential to allowing direct comparisons between PBM mail-service pharmacies and retail pharmacies.

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The Pharmaceutical Care Management Association (PCMA) is the national trade association representing America’s pharmacy benefit managers (PBMs). PCMA member companies provide pharmaceutical care management services to more than 200 million Americans.

Contact Information:
Phil Blando
202-207-3614