Transparency, regulation needed to rein in pharmacy benefit

CHICAGO —With pharmacy benefit managers playing an increasingly pivotal role not only in drug pricing but also in administering patient drug benefits, the American Medical Association (AMA) today called for oversight and transparency for the lightly regulated industry.

The new policy, part of a report adopted at the AMA’s Annual Meeting, responds to pharmacy benefit managers (PBMs)–middlemen–operating in a “black box” with limited transparency to show what goes on behind closed doors. As drug prices rise year after year, the AMA is concerned that the rebate process results in list prices above what they would be absent rebates, as neither PBMs nor manufacturers have an incentive to lower list prices.