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Understanding the ENTIRE Payment Process for
Prescription Drugs
September 8, 2009
View the Program Flyer here.
The NYC office of the law firm of Hodgson Russ LLP
(Bethany J. Hills, Esq.) hosted a lunchtime Coffee, Croissants and CLE Credit
program, entitled Understanding
the Entire Payment Process for Prescription Drugs. The speakers or the program were
James R. Schiffer R. Ph., Esq., of Allegaert Berger & Vogel LLP and
Craig M. Burridge, M.S., CAE, of the Pharmacists
Society of the State of New York.
Mr. Schiffer is a pharmacist and a lawyer who brought
together these combined experiences to address the topic. He began
by offering an extensive history of the development of the payment
process from the perspective of pharmacists, patients and prescription
drug manufacturers. He explored the innovation of Pharmacy Benefit
Managers, the involvement of the American Society of Automation in
Pharmacy and the National Council for Prescription Drug Programs.
One of the major turning points in the evolution of payment mechanisms,
according to Mr. Schiffer, was the utilization of Third Party
Administrators by state pharmacy organizations. The lack of
regulation and transparency within the payment systems was highlighted
and case studies impacting prescription drug cost were presented.
Pricing issues involved with generic .v brand drugs were explored and
Mr. Schiffer identified key areas - such as state law regulations,
clinical decision making, and FDA bioequivalency decisions - that
contribute to added costs.
Mr. Burridge, a frequent lecturer to Human Resource
organizations and large corporations seeking to curb their prescription
drug costs, then walked the audience through a number of shocking
"tricks of the trade" in the area of prescription drug pricing.
The issue of pricing "spreads" - the difference between the maximum
allowable cost permitted by the health insurance plan and the discounted
average wholsesale price (AWP) - was discussed with specific examples
highlighting the hidden income that may be obtained by pharmacy benefit
managers. The issue of transparency and permitting auditing by
employers and health insurers was also evaluated. Mr. Burridge
presented a number of practical case studies that inspired spirited
discussion from the audience.
The questions posed by the audience were prompted by
the speakers’ case studies and were answered, debated and
discussed by the presenters as well as experts and other participants in
the audience.
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