Posts Tagged "rx retail"

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PBM Pricing Post-AWP – An Estimate of Sustainable Earnings Power

Using Medco (MHS) as a proxy for large PBMs, we show that generic buying margins dominate PBM gross profits; PBMs appear to have sacrificed most (or even all) alternative sources of gross margin, levering the industry’s pricing structure almost completely

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A Detailed Comparison of the AWP Replacements: AMP v. NADAC

This note compares the two drug acquisition cost benchmarks (Average Manufacturer Price or AMP, and National Average Drug Acquisition Cost or NADAC) that CMS intends to make public. NADAC values have not been calculated or published; however because Alabama’s Average

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Co-Pay Cards and the Stalling of Drug Rebate Growth

For the first time, because of growth in both rebate percentages and brand drug prices, rebates paid for preferred formulary status now appear to roughly equal the spread in non-preferred (e.g. tier 3) and preferred (e.g. tier 2) co-pays Co-pay

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Uncertainty and Motive in Pharmacy Dispensing Mark-Ups

Recently we argued incremental (relative to brands) generic dispensing premia of roughly $5 / script ultimately will fall. This note addresses healthy criticisms of that note, particularly: 1) payors already know generic acquisition costs; and, 2) the generic dispensing premium

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October 29, 2010 – Why Generic Dispensing Margins (Eventually) Must Fall

October 29, 2010 – Why Generic Dispensing Margins (Eventually) Must Fall For both drug retail and PBM mail-order we estimate that per-Rx generic dispensing margins are $5 higher for generics than brands, and show that this premium results from: 1)

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PBM Gross Margins – This Looks Like the End of the Cycle

Since 2001, PBM gross profit per claim has grown three times faster than average drug prices, and 1.25 times faster than drug retail mark-ups As with drug retail, during this period PBMs benefitted from drug price inflation and an increasingly

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