Incubate Comment in Response to the FTC’s Request for Comments on the Business Practices of PBMs
Read Incubate's response to the FTC's Solicitation for Public Comments on the Business Practices of Pharmacy Benefit Managers and Their Impact on Independent Pharmacies and Consumers
05.25.2022
Lina Khan, Chair
Federal Trade Commission
600 Pennsylvania Ave NW
Washington, DC 20580
Electronically Submitted
RE: Solicitation for Public Comments on the Business Practices of Pharmacy Benefit Managers and Their Impact on Independent Pharmacies and Consumers
Dear Chair Khan:
I am writing on behalf of Incubate, a 501(c)4 organization that represents the early-stage life sciences network of venture capitalists, small biotech companies, and patient advocates nationwide. Our mission is to ensure that patients can continue to benefit from the innovation that early-stage investors help support. The United States’ life sciences ecosystem is the global leader in bringing new treatments to market—but this leadership only matters if patients can actually access these treatments. It is that vein I write you today.
We strongly encourage the Federal Trade Commission (FTC) to take steps to more fully understand Pharmacy Benefit Manager (PBM) practices and how they hinder the pharmaceutical distribution system. This understanding is critical if we want to alleviate patient access challenges in this country.
The financial burden many patients face at the pharmacy counter has caused policymakers to singularly target the biopharmaceutical industry with proposed solutions like Medicare negotiation that would not only have no meaningful impact on patients’ out-of-pocket costs, but would undercut our sector’s ability to bring lifesaving treatments to patients across the United States and the throughout the world. Few, if any, policy proposals have taken a holistic view at the challenges facing our entire pharmaceutical supply chain—including those perpetuated by PBMs.
Unfortunately, policymakers and consumers alike fail to realize that PBMs have actually limited patient access and driven up prescription drug costs by consolidating and concentrating their market power, neglecting to share savings with patients, and imposing burdensome access restrictions making it difficult—particularly for low- and middle-income patients—to afford their medications. Recent studies have shown that PBMs added approximately $30 billion to the cost of drugs, and that less than 50% of drug sales actually go back to the biopharmaceutical company that researched, developed, and manufactured the medicine.[1]
Incubate has long advocated for policy solutions that actually reduce what patients pay at the pharmacy counter for their prescriptions. However, the conversation must include all stakeholders in the industry, including middlemen like PBMs, not just pharmaceutical manufacturers. We urge the FTC to use this opportunity to shine a light on the perverse practices PBMs employ, particularly as the Biden Administration continues to prioritize saving patients money on prescription drugs.
We thank you for the opportunity to comment. We urge the FTC to take this feedback into consideration when studying the impact of PBM practices on access to prescription medications on American patients and would welcome the opportunity to discuss further with you.
Sincerely,
John Stanford
Executive Director, Incubate
Incubate is a 501(c)4 organization with the mission to ensure patients continue to reap the benefits of the unrelenting innovation spurred by venture capital investment in the life sciences industry and protected by the American system of intellectual property.
[1] Common Wealth Fund: Pharmacy Benefit Managers and Their Role in Drug Spending https://www.commonwealthfund.org/publications/explainer/2019/apr/pharmacy-benefit-managers-and-their-role-drug-spending
View the Request for Public Comment HERE.