ZorroCard Round Up (11/4/24)

Hey all,

hope you enjoyed the weekend. Now enjoy the round up to start your week!

Jacob Brody (Co-Founder & CEO, ZorroCard)

PBMs Accused of Favoring Pharmacies They Own, Squeezing Out Independent Pharmacies (KFF)

Pharmacy Benefit Managers (PBMs) are under fire for practices that critics say favor large chain pharmacies—many of which are actually owned by the PBMs themselves—over independent drugstores. By negotiating lower reimbursement rates for independent pharmacies while directing patients to their own chain locations, PBMs effectively tighten their grip on the market. This setup leaves independent pharmacies struggling to compete and limits patient choice, particularly in areas where small pharmacies are essential for access. This has spurred calls for reform, urging transparency and fair practices to prevent PBMs from using their influence for self-dealing at the expense of consumers and competition. Full Article

Will the Inflation Reduction Act Trigger a Surge in Drug Compounding to Meet Shortages (William Sarraille’s Substack)

The Inflation Reduction Act’s new price negotiation rules, set to take effect in 2026, may lead to significant financial strain on long-term care (LTC) pharmacies, pushing some to explore drug compounding as an alternative. Under the act, Medicare will set lower reimbursement rates for an initial list of ten high-cost drugs, reducing pharmacy revenue by as much as 80% for these medications. LTC pharmacies, which often operate on thin margins, face the dual challenges of reduced revenue and delayed reimbursements from manufacturers, possibly making it financially unviable to stock certain negotiated drugs. In response, some in the industry suggest pharmacies may pivot to compounding as a workaround, arguing that shortages created by supply gaps and high carrying costs could justify this shift. This could potentially lead to widespread compounding beyond LTC settings as more drugs are added to Medicare’s negotiated list, raising concerns about the effects on drug innovation and the long-term financial stability of the pharmaceutical market. Full Article

Amazon’s Healthcare Ambitions (Fast Company)

Amazon may be a global behemoth with its hands in every industry, but healthcare has humbled even this giant. Neil Lindsay, Amazon’s health head with a background not in medicine but in marketing, acknowledges the challenge as Amazon “helps” healthcare experts do what Amazon does best—make things marginally easier, just stacked together for bigger convenience. From its joint venture Haven’s quiet collapse to acquiring One Medical and launching Amazon Pharmacy, Amazon’s latest goal is not to revolutionize healthcare but simply to make it a bit more Amazonian and, hopefully, a lot more convenient. Full Article