Navigation Links
Brand Drug 'Copay Coupons' Undermine Generics, Raise Health Costs by $2.1 Billion in Florida
Date:11/16/2011

WASHINGTON, Nov. 16, 2011 /PRNewswire-USNewswire/ -- The proliferation of brand drug "copay coupon" promotions, which lure insured consumers from generics to more expensive brands, will increase costs by $2.1 billion in Florida over the next decade for employers, unions, and state employee plans, according to new research from Visante and released by the Pharmaceutical Care Management Association (PCMA).  The use of these promotions by state and local government workers alone will cost Florida taxpayers an extra $284 million over ten years.

Click here to read the study

Unlike groceries and other goods that are purchased directly by consumers, 2/3 of prescription drug costs are paid by the employers, unions, and government agencies (i.e., taxpayers) that provide coverage, not consumers themselves.  Though banned as illegal kickbacks in federal health programs, copay coupons are unregulated in the commercial market (except Massachusetts).  

To minimize premiums and reduce costs, those who offer prescription drug coverage assign higher copays to expensive brands and lower copays to more affordable drugs that treat the same condition.  In response, drug companies now offer coupons that cover the higher copays but not the cost of the actual drug.  By covering a $50 copay to sell a $150 brand, drug companies extract an extra $100 from the employer, union, or government agency that offers coverage.  This helps explain why copay coupons target only those with insurance (i.e., those who pay copays), not the poor or uninsured.

"Brand copay coupons lure patients from generics to expensive brands and stick employers, unions, and government employee health programs with the extra costs," said PCMA President and CEO Mark Merritt.  "In Florida, taxpayers will pay an extra $284 million just to cover the use of brand copay coupons by government workers in state and municipal employee health programs."

Drug companies profit from coupon promotions in several ways:

  • Copay coupons induce consumers to choose higher-cost brands (despite higher copays) over lower-cost competitors (despite lower copays).  When consumers redeem copay coupons, the drug companies process them through a "shadow claims system" that prevents employers and other plan sponsors from knowing when enrollees have used them.
  • Drug companies often require consumers to submit confidential, personal information in order to redeem copay coupons.  Manufacturers have long sought (but found difficult to obtain) such sensitive patient data, which enables them to identify and directly target individual patients with "brand loyalty" marketing programs.

Coupons can also increase consumer costs in several ways:

  • To help cover the $4 billion spent annually on copay coupons nationally, manufacturers can simply raise prices.  Manufacturers reportedly earn a 4:1 to 6:1 return on investment (ROI) on copay coupon programs.
  • Copay coupons create "brand loyalty" to the most expensive products in each therapeutic class of drugs, even among newly diagnosed patients.


'/>"/>
SOURCE Pharmaceutical Care Management Association
Copyright©2010 PR Newswire.
All rights reserved

Related medicine technology :

1. Report: Brand Drug Copay Coupons Raise Health Costs for Employers, Unions, and State Governments by $32 Billion
2. UBM Live to Roll Out Pharma Contract Services & Outsourcing Brand in the US in 2012
3. Popular Sleep Supplement Brand Settles Patent Infringement Suit Against Store Brand Manufacturer
4. Prasco Named Exclusive U.S. Distributor for Selected Aspen Branded Products
5. A New Constant Companion: BodyMedia® Enlists Americas Toughest Trainer, Jillian Michaels, as a Brand Partner
6. DreamBrands New Formula Helps Men Feel Younger and Stronger While Naturally Raising Low-T Without Prescription Drugs
7. Octapharma Launches Clinical Trial to Evaluate Efficacy & Safety of wilate® In Preventing Surgical Bleeding in Type 3 von Willebrand Disease Patients
8. Why the Brand Surgical Institute in L.A. is Fast Becoming the Authority on Weight Loss Surgery
9. U.S. Branding Group Ltd. to Sponsor DigiPharm Europe 2011, Showcase PharmaDrive™ USB Insert™ Paper Webkey
10. IMD Announces the Acquisition of the Kidshape® Brand
11. Simceres Branded Generic Formulation Biqi Passes EU-GMP Inspection
Post Your Comments:
*Name:
*Comment:
*Email:
(Date:4/21/2017)... , April 21, 2017 Halo Labs ... throughput biopharmaceutical particle analysis system called the Horizon at ... May 1st. The new system analyzes sub visible particulate ... time rapid particle screening as early as candidate selection ... with leading biopharma contract research organization Elion Labs ...
(Date:4/20/2017)... , April 20, 2017  RXi Pharmaceuticals Corporation ... therapeutics that address significant unmet medical needs, today ... the Company,s consumer product development program, based on ... Society for Investigative Dermatology (SID) 76 th ... and promote the sciences relevant to skin health ...
(Date:4/20/2017)... , April 20, 2017 Research and ... Market Size, Market Share, Application Analysis, Regional Outlook, Growth Trends, ... report to their offering. ... The global pharmacogenomics market was valued at US$ 7,167.6 Mn ... by 2024, expanding at a CAGR of 5.6% from 2016 ...
Breaking Medicine Technology:
(Date:4/24/2017)... Seattle, Washington (PRWEB) , ... April 24, 2017 , ... ... T-Fal OptiGrill, Oxiclean, Space Bag, Sonicare Toothbrush, Juiceman Juicer, and the George Foreman Grill ... than perhaps any other marketer in the last 25 years. , Now, due to ...
(Date:4/24/2017)... ... April 24, 2017 , ... The world-class designers ... to bring their novel lifesaving device for the everyday use of parents worldwide. ... specially designed to read a child’s vital signs, and detect unusual symptoms or ...
(Date:4/24/2017)... ... April 24, 2017 , ... According to ... deaths now claim the lives of 62 Americans each day.(1) Yet since 2011, ... manufacturers, distributors, pharmacies and prescribers by more than half.(2) Novus Medical Detox ...
(Date:4/24/2017)... ... April 24, 2017 , ... Pitavastatin, ... HIV because it is not known to have significant interactions with antiretroviral therapy ... both lower cholesterol levels and dampen inflammation in the bloodstream. , While lowering ...
(Date:4/24/2017)... FOREST KNOLLS, Calif. (PRWEB) , ... April 24, 2017 , ... ... and health topics, but she has not found any of them to be very ... weekly actions to slowly and easily make changes in their health. It prompted her ...
Breaking Medicine News(10 mins):