SAN FRANCISCO--(BUSINESS WIRE)--SmithRx, a San Francisco based technology company and Pharmacy Benefit Manager (PBM), today released the company’s public comment on the HHS proposed rule to end manufacturer-to-PBM rebates in Medicare and Medicaid which have been aided by a safe-harbor protection exempting these rebate payments from federal rules prohibiting kickbacks.
In the public comment, SmithRx commends HHS for proposing an end to protection for manufacturer-to-PBM rebates in Medicare and Medicaid and calls for additional reforms, including adopting new transparency requirements and avoiding new safe harbor protections for point-of-sale rebates and manufacturer-to-PBM service fees. Rather than shifting the recipient of rebates, HHS should oppose rebates altogether given the obfuscation and lack of transparency that is implicit with any such system. SmithRx believes that while the goal of this point-of-sale price reduction is an admirable one, the only way to generate true price competition is to make it clear to all parties how much drugs really cost.
In addition to the HHS proposed rule, the Senate Finance Committee will also hear from the nation’s largest PBMs at a hearing on April 9 aimed at addressing the bipartisan concern over the rising cost of prescription drugs.
“Senators should contemplate a world without rebates, one where list prices are actual prices, and where PBMs compete for business based on their ability to promote strong therapeutic outcomes and service customers more efficiently,” says Jake Frenz, SmithRx founder and CEO.
SmithRx’s public comment details how a world without pharmaceutical rebates might function to align more closely with the needs of patients. PBMs could leverage their power to ensure only drugs with a reasonable balance between cost and therapeutic outcome are given favorable treatment on their approved drug plans and manufacturers would finally be forced to revisit their high list prices.
The full public comment can be viewed here.
About SmithRx
SmithRx is a start-up pharmacy benefit management (PBM) company based in San Francisco. Over the past three-plus years, SmithRx has succeeded in bringing an alternative model to the PBM space. The SmithRx model couples technological innovation and efficiencies with a transparent and auditable pricing program that passes through all manufacturer rebates to plan sponsors. SmithRx fulfills the role of PBM without tying its revenue to rebates or other payments from manufacturers. For more information visit smithrx.com.