Navigation Links
Brand Drug 'Copay Coupons' Undermine Generics, Raise Health Costs by $447 Million in Connecticut
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 $447 million in Connecticut 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 Connecticut taxpayers an extra $63 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 Connecticut, taxpayers will pay an extra $63 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. Brand Drug Copay Coupons Undermine Generics, Raise Health Costs by $2.1 Billion in Florida
2. Report: Brand Drug Copay Coupons Raise Health Costs for Employers, Unions, and State Governments by $32 Billion
3. UBM Live to Roll Out Pharma Contract Services & Outsourcing Brand in the US in 2012
4. Popular Sleep Supplement Brand Settles Patent Infringement Suit Against Store Brand Manufacturer
5. Prasco Named Exclusive U.S. Distributor for Selected Aspen Branded Products
6. A New Constant Companion: BodyMedia® Enlists Americas Toughest Trainer, Jillian Michaels, as a Brand Partner
7. DreamBrands New Formula Helps Men Feel Younger and Stronger While Naturally Raising Low-T Without Prescription Drugs
8. Octapharma Launches Clinical Trial to Evaluate Efficacy & Safety of wilate® In Preventing Surgical Bleeding in Type 3 von Willebrand Disease Patients
9. Why the Brand Surgical Institute in L.A. is Fast Becoming the Authority on Weight Loss Surgery
10. U.S. Branding Group Ltd. to Sponsor DigiPharm Europe 2011, Showcase PharmaDrive™ USB Insert™ Paper Webkey
11. IMD Announces the Acquisition of the Kidshape® Brand
Post Your Comments:
*Name:
*Comment:
*Email:
(Date:2/23/2017)... , 23. Februar 2017 Im Rahmen ... nationale Wirtschaftszone in der südwestlichen chinesischen Provinz Guizhou, 2017 mit ... einer Innovationsplattform aktiv an der Entwicklung einer eingebetteten Hightech-Schlüsselindustrie. ... Continue Reading ... ...
(Date:2/23/2017)... VALLEY COTTAGE, New York , February 23, 2017 ... to health implications arising from increasing caseload for varicose ... cases recorded across the globe are prompting the adoption ... A latest study on global endovenous laser therapy ... growing attention towards aftereffects of lifestyle choices and consequences ...
(Date:2/23/2017)... WASHINGTON , Feb. 23, 2017  As ... tips.  In addition, the Company is helping people ... through its customized prescription savings programs in all ... Florida Prescription Assistance Program  and  California Prescription Assistance ... tips from Columbia University for nutritious ...
Breaking Medicine Technology:
(Date:2/24/2017)... ... February 24, 2017 , ... Indiana Fiber Network (IFN) ... company later this year. Dyer started as the Chairman of the Management Committee ... establishment of the corporation including the recruitment of investor/owners and development of the business ...
(Date:2/24/2017)... MI (PRWEB) , ... February 24, 2017 , ... ... in Charlevoix, once again hosted their Military Wedding Giveaway, with the winning ... hosted by Castle Farms with services generously donated from local vendors: A Matter ...
(Date:2/23/2017)... ... February 23, 2017 , ... The Lymphoma ... innovative lymphoma research and serving the lymphoma community through a comprehensive series of ... Gorce Country Club in Miami Beach to host its Swirl: Miami Wine Tasting ...
(Date:2/23/2017)... ... ... Hamlin Dental Group and Dr. Hamid Reza, dentist in North Hollywood ... of February, patients who visit Hamlin Dental Group will receive a ticket for a ... the Cheesecake Factory. , Tickets are available for routine dental visits and other ...
(Date:2/23/2017)... Nevada (PRWEB) , ... February 23, 2017 , ... Dr. ... Avenue in Henderson, NV 89052. Dr. Mahon was named a 2017 Top Patient Rated ... Doctors is an online directory that recognizes local physicians and dentists who have ...
Breaking Medicine News(10 mins):