Bullied into Extinction

Specialty Pharmacy Times, July/August 2014, Volume 5, Issue 4

Government involvement may be required in order to keep corporate entities from bullying specialty pharmacies out of business.

Government involvement may be required in order to keep corporate entities from bullying specialty pharmacies out of business.

They’re not just on playgrounds or in high school locker rooms. Bullies are found everywhere. And as they grow up, they even find themselves in the boardroom. I was a fortunate student, well-liked and more of a leader than a follower. When I purchased my first pharmacy in 1994, I thought life was going to be grand. I had a professional degree with which I could help patients and grow my own business and let my entrepreneurial spirit flourish. Fast forward 20 years and 8 pharmacies later, and I can’t believe the state of our health care and the battleground that takes patients hostage. Now I know where the expression “young and dumb” comes from.

Today, we face corporate bullies who are a lot bigger and more powerful than the ones from our childhood. These bullies come in all different sizes and styles, from public, private, international, and nonprofit corporations. Their arsenal consists of the same bully tactics we experienced on the playground—humiliation, exclusion, and breaking of psychological and physical (financial, in business) strength and confidence. Their arrogance and complacent attitude encourage them to ignore laws, change rules, and do whatever it takes to accomplish their goals.

Some relevant examples of their actions are pharmaceutical companies establishing limited distribution networks only in the United States; pharmacy benefit management (PBM) and insurance companies mandating the use of their company-owned pharmacies; PBM and insurance companies using scare tactics, threatening termination, and avoiding “any willing provider” state laws; and wholesalers that use net pricing and changes to prime vendor agreements to always keep the advantage. I recently had an insurance company’s pharmacist tell me that a law that used the terms prescription medication only applied to the “mail-order benefits and not to the specialty benefits.” Of course, I reminded this pharmacist that insurance benefit design has no relevance over a law that clearly covers all prescription medications. I guess he was absent from school when we learned about legend drugs and the FDA?

Of course, the bullies always try to disguise their actions with claims of better care, improved services, and cost savings. The claim that the United States has “the best health care system in the world” is clearly not true. According to the World Health Organization (WHO), our country spends a higher portion of gross domestic product on health care than any other country in the world, yet we rank 37th out of the 191 countries in the WHO ranking in quality of care. When compared with other developed countries, the United States performs worse on life expectancy and infant mortality, and it also tops the list of deaths deemed “preventable” with adequate early care and diagnosis. For the fifth year in a row, the United States ranked last when compared with other wealthy countries such as Germany, France, Switzerland, and Australia when it comes to ensuring health care access, efficiency, and equity. The simple, indisputable fact that we spend the most for a mediocre health system tells us that something is wrong. These corporate bullies are lobbying Congress and misleading patients. Are we really to believe that limited distributed medications, narrow networks, specialty mail-order pharmacies, and mandated programs are better for patients and save money? The proof is always in the numbers.

In our youth, we had teachers, principals, and parents to help us deal with bullies. So how can we deal with corporate bullies today? Here is where our legislators need to get involved. Let’s remember that federal and state governments are the largest payers of health care, and that the revenue used to fund these payments comes from taxpayers, and of course, these taxpayers are the same voters that elect our legislators. We need our elected officials to govern corporate greed and inappropriate actions.

All pharmacies that participate in a Medicare program must have all employees sign a code of ethics and a conflict of interest statement. They also need to be trained in fraud waste and abuse, and they need to be aware of the federal anti-kickback statute. Shouldn’t we all play by the same rules? Isn’t it a conflict to steer or mandate patients to a specialty pharmacy where a corporation has a financial interest? Isn’t it a conflict to buy an asset (PBM, specialty pharmacy, pharmaceutical medication) in return for an exclusive 10-year deal? If a pharmaceutical company is found guilty of the anti-kickback statute, should they be allowed to sell drugs in federally and state-funded programs? In all these situations, the patients are used as pawns and unfortunately pay the price of being caught in the middle.

We need our federal and state governments to get involved. We need to ensure that all specialty pharmacies are providing the best level of care and are not allowed to be bullied into extinction. SPT

About the Author

Nicholas Karalis, RPh, is president of the Community Specialty Pharmacy Network and chief executive officer and president of Elwyn Specialty Care.