Consolidation has increased in the US healthcare sector over the past two decades, with mergers and acquisitions taking place at national players at multiple levels of the supply chain, including pharmacies. The pharmacy market has undergone significant changes, with vertical and horizontal consolidation, increasingly challenging independent pharmacies, growth of specialty pharmacies, and exponential presence and influence of pharmacy benefit managers (PBMs). The landscape is complex, with conflicting opinions and theories about the impact of these changes on the market, and whether they lead to increased cost and out-of-pocket costs for cancer patients.
By contrast, Walgreens also expanded, but remained primarily in the drugstore market alone. The second largest drugstore chain in the United States after CVS Health, Walgreens has been busy eliminating its competition by incorporating other chains and related e-commerce into its brand. Over the past decade, Walgreens has acquired the New York City-area chain Duane Reade; Drugstore.com and Beauty.com; Alliance Shoes a Mid-South drugstore chain operating under the USA Drug, Super D Drug, May’s Drug, Med-X, and Drug Warehouse signs; And finally, drugstore chain Rite-Aid.
However, some argue that these acquisitions may have little effect on cancer patients. “Although the integration of retail pharmacies may create some inconvenience to patients, pharmacies standardization is not expected to have a significant impact on cancer care in a community setting,” says Ann Johnson (Pharmacy Healthcare Solutions, Pittsburgh, PA, USA) . “The costs that patients pay for drugs, such as their contributions, are determined by health plans and PBMs, not the pharmacies themselves, so consolidating pharmacies will not raise prices for consumers. Similarly, from a pharmacy perspective, the amount reimbursed to a pharmacy is determined in network agreements. their PBM”.
Oncology drugs have traditionally been given in healthcare settings, but the emergence of oral anticancer agents has changed this dynamic. Although some patients get their medication from a retail pharmacy, most use a specialty pharmacy or receive it by mail. Additionally, a model known as medically integrated dispensing allows oncologists to dispense oral anticancer drugs in their on-site pharmacy practices. Other types of mergers that threaten the safety of cancer care are the most threatening, says Nicholas Ferrius (Community Oncology Alliance, Washington, DC, USA), with the insurance company, physician and PBM all linked.
One area of interest, Ferrius says, is the vertical integration of insurance companies and physicians, as insurance companies introduce their practitioners. One example is UnitedHealthcare, the largest health insurance company in the United States and also the largest single employer of doctors in the country. UnitedHealth Group’s OptumCare company has approximately 43,000 affiliated physicians or employees; The Optum Healthcare subsidiary also includes MedExpress Urgent Care Facilities, Ambulatory Care Surgical Centers, HouseCalls Home Visits, Behavioral Health, Care Management, Rally Health Wellness and Consumer Digital Engagement. “They can control primary care referrals and they can control prescriptions and being a fully integrated entity, they keep everything in their network,” Ferreros says. “Decisions are not always made in the best interest of patients or at the best value.”
Ferrius explained that PBMs are more likely to push toward brand-name drugs, as opposed to generic drugs or biosimilars, where they may have an incentive to prefer higher-priced drugs. Because PBMs often receive discounts that are calculated as a percentage of the manufacturer’s list price, they get a larger discount for more expensive drugs, as opposed to drugs that provide better value at a lower cost. “Patients with high deductibles or co-payments based on the drug price list could end up paying more for their money,” Ferreros said.
The standardization of RBM is even more worrisome because it has left a few companies with an impractical level of control and influence in the healthcare system. Although there are dozens of PBMs, the three largest by market share are vertically integrated with a large insurer: Caremark with CVS/Aetna, Express Scripts with Cigna, and OptumRx with United. The largest PBM not owned by a single health insurance company is Prime Therapeutics, which is owned by 14 health plans from Blue Cross and Blue Shield.
“This is not good for any patient,” says Matthew Seiler (National Society of Community Pharmacists, Alexandria, VA, USA). “PBMs integrate with the insurance company and integrate with pharmaceutical companies, and that creates an access problem.”
Zeiler notes that patients may not be able to use the pharmacy of their choice because it is “not in the network,” and instead are directed to integrated pharmacies. “Maybe they should use the mail command instead, for example,” Zeiler said. This leads to delays in getting the drug, prices may go up, etc. There is no choice for patients and there is no cost transparency.”
“Although many people have never heard of pharmacy benefit managers, these powerful intermediaries have an enormous impact on the US prescription drug system,” Lina M Khan (FTC, Washington, DC, USA) said in a statement. “This study will shed light on the practices of these companies and their impact on pharmacies, payers, clinicians, and patients.”
The Community Oncology Alliance notes that the two main issues with losing community practices are access and cost. When rural clinics are closed, for example, this leads to an access problem, as patients may have to travel longer distances to get care. This access problem can cause inconvenience especially if patients have transportation or mobility difficulties.
Increased PBM and standardization of pharmacology, combined with the continued disappearance of independent oncology practices, may place more barriers to accessible and affordable cancer care. Healthcare mergers and acquisitions continue at a steady pace, but may negatively impact the cost, quality, and accessibility of cancer care.
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Publication date: September 23, 2022
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