WIDER COPAY DIFFERENTIALS BOOST GENERICS

Generic drug substitution rates arelikely to increase by 3 to 4 percentagepoints for pharmacy benefit plans thatraise the copay differential betweenbrand and generic drugs by $10,according to a new study of third-partybenefit designs. Describing the brandvs-generic copay differential as "a keydriver" for increased use of lower-costgeneric drugs, researcher Jake Cedergreensaid his study's findings demonstratehow "benefit design can effectivelyreduce drug costs by aligning theinterests of the member and the plansponsor around the low-cost prescriptionalternative."

To achieve what they called the "memberfair share" level for drug plan copays,the researchers suggested "slightly"reducing copays for generics whileincreasing copays for branded drugs bythe same amount. In this way, the plancan boost generic drug use withoutincreasing costs to members.