Express Scripts: More Payers Will Refuse to Reimburse High Priced Cancer Drugs

Drug companies will find more payers refusing to reimburse for cancer drugs if they don’t reduce their prices, pharmacy benefits manager Express Scripts says.

Speaking at the JP Morgan Healthcare Conference in San Francisco, George Paz, CEO of the pharmacy benefit giant, said drug companies should prepare for payers that negotiate more aggressively and earlier in a drug’s approval process because the PBM industry sees an opportunity for significant savings on cancer drugs.

Historically, meetings between drugmakers and payers have consisted mostly of pharma companies presenting the clinical merits of their products without asking payers for their perspectives, Express Scripts spokesman David Whitrap said.

This began to change last year, with payers taking a closer look at clinical data to determine the most effective treatments for cancer indications prior to a drug’s launch and telling drugmakers what they are willing to pay. The industry should prepare for more of these early price negotiations.

This is especially important when clinically similar alternatives are available, Whitrap said, where the PBM industry is focusing greater effort on finding cheaper, alternate treatments. And he cautioned against drugmakers trying to demand orphan drug prices for non-orphan drugs. Payers will not continue reimbursing for drugs in those cases. — Lena Freund