On 5/11/2018, President Donald Trump shared his plan to reduce pharmaceutical drug prices with the PBMs. “We’re very much eliminating the middlemen” he’s stated yesterday. But who are these middlemen (PBMs) exactly?
PBM stands for pharmaceutical benefit managers. In short, PBMs are the middlemen in between the drugmakers and consumers and have a strong influence over the high drug prices. Their role is to manage pharmacy benefits on behalf of employees and managed-care organizations. PBM’s largest customers are Medicare and Medicaid. A few of large companies included in the PBM’s club are CVS, Express Scripts, United Health Care and several others.
UNH (United Health Care-$238.50 CSP), one of the nation’s largest health ensurers, is already implementing action on January 1st, 2019 to give discounts to all of their customers when applied to fill their pharmacy drug prescriptions from mail order on at their local pharmacy.
The PBMs control 75% of the nations pharmaceutical drug spending. Many investors are very happy with the policies that will be implemented. The lower health care drug prescription costs to consumers may improve the quality of the companies and efficient revenue.