When It Comes to the Drug Pricing Debate, Talk Is Cheap

In the last several months, individual companies have begun to take actions in an attempt to address pricing concerns and demonstrate their ability to “self-police” — especially in the face of bad actors that have fueled hatred of the pharmaceutical industry by taking significant price increases on single-source products.

These actions have ranged from taking pledges to limit annual price increases to improving transparency of pricing — including disclosing price increases, entering into value-based pricing schemes and devising innovative partnerships to lower the cost of certain medicines for patients — to entering into new partnerships to provide discounts on the medicines they sell at the pharmacy.

But the question remains — to what extent have or will these actions actually make a difference in how these companies are perceived by the public and by legislators? What is the potential benefit of these various actions for reputation, for gaining a seat at the table in policy discussions or for fighting off damaging state and federal legislation — compared to the potential risk of maintaining the status quo? Is staying out of the news enough, or are proactive actions required?

APCO Worldwide recently conducted opinion research to try and answer these questions and to understand what actions may be most helpful in positively positioning pharmaceutical companies in the current debate on drug pricing. Specifically, we asked stakeholders — including the opinion-leading public, health care providers and policymakers — what actions most demonstrate companies are doing the “right thing” when it comes to access and affordability.

So what moves the needle the most? We found that stakeholders want to see companies demonstrate that they have patients’ best interests in mind, act as an advocate to improve access and affordability. What actions accomplish this?

1.) Advocate for policies aimed at improving access to medicines – Companies must have a point of view on how to improve access and affordability for patients, and publicly advocate for that position.

2.) Partner to improve access – Stakeholders like to see companies working with others in the system — health insurers, pharmacy benefit managers or others — to improve access to patients. This suggests innovative discount programs that have recently been implemented by companies to reduce prices to patients at the pharmacy are widely viewed as positive.

3.) Share details on how medicines are priced — Transparency, transparency, transparency. Even if it doesn’t change how prices are determined, stakeholders expect to see companies disclosing more information about how their medicines are priced. Transparency helps improve trust and demonstrates companies are not taking advantage of patients or the system.

On the flip side, our research also showed the actions that don’t break through, or that can make things worse.

Interestingly, we found that maintaining the status quo will not be enough to address stakeholder concerns. Specifically, companies have increasingly tried to communicate that they negotiate with payers to help improve access — something that has been done in the industry for a long time — but this activity is not viewed especially favorably. Nor are the access programs that provide free or discounted medicines to patients in need — programs which companies have long touted.

Bottom line: Communicating more while continuing to do the same things will not help quell the ongoing criticism.

And finally, the worst companies can do? Get called out as a bad actor. Whether for taking large price increases or launching a medicine with a high price, giving large bonuses or salaries to senior executives or making exceptionally high profits, media coverage of these actions is distinctly viewed by stakeholders as doing “the wrong thing.”

While concerns about pricing are unlikely to dissipate in the near future, these results clearly demonstrate that there are several “right things” companies can do to address concerns.

The catch? Companies must be past the point of relying on words alone, and be willing to take concrete action that either directly alleviates patients’ pocketbook pains or addresses the confusion and uncertainty surrounding the high cost of drugs everyone is hearing about.

Over the last year, we’ve seen several companies take steps aimed at doing just that — from efforts meant to clarify their approaches to pricing to those engaging unique partnerships to provide additional discounts at the pharmacy counter.

In the end, our research suggests it will be these same companies that are increasingly able to move the needle and meaningfully engage in the pricing debate moving forward.

Chrystine Zacherau is a senior director with APCO Insight, the opinion research group at APCO Worldwide, and manages APCO Insight’s global health care research. April Claassen is a director of health policy in APCO Worldwide’s Washington, D.C., office and works with APCO’s health care clients.

Morning Consult welcomes op-ed submissions on policy, politics and business strategy in our coverage areas. Updated submission guidelines can be found here.


Health Brief: GOP Senators Ask CBO to Fast-Track ACA Overhaul Review

Senate Republican leaders have asked the Congressional Budget Office to fast-track consideration of a plan from Sens. Lindsey Graham (R-S.C.) and Bill Cassidy (R-La.) to overhaul the Affordable Care Act. The CBO is reportedly in the process of analyzing the cost and coverage impact of the plan, as Republicans face pressure to make one last attempt at undoing the ACA before GOP senators’ ability to pass legislation with a simple majority expires on Sept. 30.

Health Brief: Week in Review & What’s Ahead

HELP Committee Chairman Lamar Alexander (R-Tenn.) hopes to reach a deal with Democrats on a plan to shore up the ACA exchanges early this week. A final agreement, if reached, is likely to extend key insurer payments, known as cost-sharing reductions, and include reforms to make it easier for states to establish reinsurance programs. Some Republicans are also pushing to give states more flexibility over required benefits in Obamacare plans, a proposal that is controversial with Democrats.

Health Brief: Some Moderate House Democrats Seek ACA Stabilization

While progressives this week rallied behind Sen. Bernie Sanders’ (I-Vt.) single-payer health care bill, a group of moderate House Democrats in the New Democrat Coalition aligned themselves with the Senate Health, Education, Labor and Pensions Committee’s bipartisan push to stabilize the Affordable Care Act exchanges, which Committee Chairman Lamar Alexander (R-Tenn.) aims to reach a final deal on by early next week.

Health Brief: Deal Reached to Extend CHIP Funding

Senate Finance Committee leaders reached a deal on a five-year reauthorization of the Children’s Health Insurance Program, in a win for children’s health advocates who are seeking longer-term funding certainty for the program, which will expire at the end of the month without congressional action. The deal also gradually phases out the enhanced federal share of funding for state CHIP programs, which was increased under the Affordable Care Act by 23 percentage points.

Health Brief: Some Navigators Shut Down Ahead of ACA Enrollment Period

Several navigator organizations, including one that received the largest federal grant for Obamacare enrollment activities in 2016, are suspending operations ahead of the 2018 open enrollment season because they haven’t received contracts for funding from the Department of Health and Human Services, which could cause enrollment to plummet. The Trump administration announced plans last month to cut funding for navigator groups by about 40 percent, but health officials haven’t said whether the grants would end altogether.

Health Brief: Teva Names New CEO

H. Lundbeck A/S’s Kaare Schultz was named as Teva Pharmaceutical Industries Ltd.’s new chief executive officer, ending a seven-month search by the world’s largest generic drug maker to find a new leader. Schultz could face pressure to split the company into two businesses, one focusing on patented specialty drugs and the other on cheap copycat medicines

Health Brief: Week in Review & What’s Ahead

HELP Committee Chairman Alexander hopes to reach bipartisan consensus on a bill to shore up the ACA exchanges by the end of the week. The committee is set to hold two final hearings as members try to resolve two issues: the duration of funding for insurer payments known as cost-sharing reductions and the best way to approach reinsurance.

Load More