The Kickbacks and the Cost of Insulin

Kudos to board member Marion Mass on her recent letter to the editor of the Wall Street Journal 15 Apr 2022 highlighting the way Pharmacy Benefit Managers contribute to the high cost of insulin (and many other medications) for patients:

“Credit to the editorial board for alluding to the role of PBMs in America’s costly and dysfunctional prescription-drug debacle. The “rebates” collected by the PBMs are more accurately called kickbacks, as the PBMs enjoy an exemption from the antikickback statute.

Given that PBMs create formularies, which are the lists of drugs covered by third-party payers, pharmaceutical companies can pay a kickback to functionally purchase formulary placement, which amounts to market share. This obscene conflict of interest has been plainly stated at congressional hearings. Insulin and every other medication market begs for competition. We won’t have it so long as the market allows drug makers to purchase their market share through legal kickbacks.

The kickbacks account for as much as 80% of the cost of insulin, as highlighted in a 2021 Senate Finance Report. The disingenuously named Affordable Insulin Now Act doesn’t lower the cost of insulin or any other drug, because the bill does nothing to make the PBMs accountable.”

Marion Mass, M.D.

Perkasie, Pa

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