CVS long-time executive David Joyner spoke at a Senate Health, Education, Labor and Pension Committee hearing in Washington, DC on May 10, 2023.
Al Drago | Bloomberg | Getty Images
CVS Health CEO David Joyner’s defense was controversial on Wednesday Pharmacy middleman Like his company’s Caremark unit, it has been widely accused of rising prescription drug prices, but rather accusing manufacturers of “monopoly tendencies” that remain high in the United States.
Joyner started the role in October and spent most of his time at the company. Fourth quarter revenue call Discuss the so-called pharmacy welfare manager or PBM. For the start of the quarterly appeal of CVS, it was atypical, but at the time when both sides of the aisle and President Donald Trump’s legislators Signal interest When attacking PBM.
CVS owns Caremark, one of the three largest PBMs in the United States, and jointly manages about 80% of the prescriptions in the United States
Those middlemen negotiated discounts on behalf of the insurance company with the drug manufacturer, creating a list of drugs called configurations that are covered by insurance and reimbursed for a pharmacy for prescriptions. However, both lawmakers and drugmakers believe that PBMs are too much negotiating discount plans with them, paying pharmacies and plans that fail to save from those discounts charge patients.
Joyner acknowledges that rising health care costs in the U.S. put pressure on patients, employers and the federal government. He accused factors such as increased patient utilization of services, rising health care provider costs, labor shortages and “sharp price increases” for branded drugs.
But PBMs like Caremark are “one of the most powerful forces that help offset rising health care costs,” he said, claiming they are the only part of the drug supply chain that focuses on reducing costs only.
“Our work is an important balance of monopoly tendencies for drug manufacturers,” Joyner said. “That’s why PBM is needed and why manufacturers work so hard to limit our capabilities.”
He claimed that brand manufacturers increased $21 billion in annual total drug spending through price increases in the first three weeks of January, but did not cite where the figure came from.
Joyner added that multiple economists estimate that PBM generates net value for the U.S. healthcare system every year, more than $100 billion.
“No one has shown more success than PBMs that lower the price of drugs,” he said.
However, pharmaceutical industry and lawmakers believe that PBMS and insurers make money from negotiated discounts and discounts rather than passing it on to patients.
In a statement Wednesday, PHRMA, the country’s largest pharmaceutical industry lobbying group, said PBMS “was subject to strict, due scrutiny.”
“National prosecutors from both parties, policymakers in Congress and state legislatures, as well as the FTC, are investigating these health care groups,” a PHRMA spokesman said. “They all came to the same conclusion: PBM is sacrificing patients, employers and us,” he said. health care systems are at the expense of increasing costs and reducing tolls.”
