Fight over drug discount coupons’ real cost flares up as patents expire

{mosads}”Employer costs rise dramatically when enrollees choose expensive brands over more affordable options,” the report says. “The economics of brand copay coupons are simple: each time a drug company can sell a $150 product by helping cover a $50 copay, it gains $100 in revenue, which is paid by the employer that offers coverage.”

The drug lobby Pharmaceutical Research and Manufacturers of America (PhRMA) responded to the report by pointing out that copay assistance helps patients stay on their medications, which has been shown to reduce healthcare costs.

“Disproportionately high cost-sharing requirements for medicines can have a significant impact on patients’ ability to access cutting-edge treatments,” PhRMA Vice President Karl Uhlendorf said in a statement. “Coupons and vouchers provide an important benefit to patients by defraying the cost of out-of-pocket payments, breaking down barriers to access and encouraging better medication adherence.”

The report estimates that coupon programs have increased by more than 260 percent in the past two years as more and more drugs begin to face generic competition as their patents expire. It estimates that drug makers spend $4 billion annually on copay coupon programs.

The report also estimates what would happen if existing coupon bans were reversed.

Halting enforcement of the Medicare prescription drug program’s ban would cost the program $18 billion over 10 years, the report estimates. And allowing copay coupons in Massachusetts – the only state to ban the practice – would increase prescription drug costs for employers and other plan sponsors by $750 million over the same period.

The Massachusetts House voted this year to lift the ban, but a Senate version requiring drugmakers to offer the coupons indefinitely derailed final passage. The debate is ongoing.