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Politics & Government

Utah hears a few industry ideas on how to bring prescription drug costs down

Pharmacist holding medicine box and capsule packs.
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One organization suggested more transparency in the system would help with reducing prescription costs in Utah.

What can state leaders do to make prescription drugs more affordable? That’s the question legislative leaders discussed during an interim session Wednesday.

Health and Human Service committee members met with various stakeholders from insurance companies to health organizations to drug companies to talk about best practices for reducing prices.

Companies like Lehi-based Civica RX are working to reduce the cost of Insulin for Utahns by about 80% lower than the current market rate. Chairman of the Board, Daniel R. Liljenquist, said they are set to start manufacturing generic drugs for retail purchase as early as 2024.

One way he said state lawmakers could help was by preventing blowback from other major insulin companies.

“The Legislature can play an important role in making sure that the drug companies cannot retaliate against Civica through legislation,” Liljenquist said. “And so being aware of what we're trying to do and the positive impact we hope that it will have on patients in Utah is really critical.”

Understanding why these drugs are so expensive can get complicated. Pharmaceutical Research and Manufacturers of America, an industry trade group, said it comes down to rebates.

In their report, they wrote that health insurance companies and pharmacy benefit managers — third-party administrators of prescription drug programs for commercial health plans — often receive sizable rebates from pharmaceutical manufacturers.

“One solution is requiring plans to pass through a portion of manufacturer rebates that would go a long way toward improving patient affordability and increasing adherence,” said Katelin Lucariello, senior director of state policy at PhRMA.

Eric Cannon, associate vice president of pharmacy benefits at insurance provider Select Health, said one thing that’s missing is transparency. He said there was such a lack of transparency with third-party PBMs and that they were charging far above what the medication cost they decided to create their own.

“In my mind, the solution is really we need to drive transparency,” Cannon said. “We have put forward transparency requirements for both manufacturers and PBMs. We currently have a lot of reporting requirements on health plans. I think if you look at a health plan, [they] are far more regulated in this sector than just about anybody else in terms of what we need to report and even in terms of what we're allowed to make.”

Others suggested giving physicians more data tools to help their patients assess costs. While it's unlikely immediate decisions would come from the interim session, lawmakers said they will consider the suggestions for future policymaking.

Corrected: May 20, 2022 at 5:20 PM MDT
In an earlier version of this story, Katelin Lucariello's surname was spelled incorrectly.
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