One reason Big Pharma backs reform

For more evidence of why Big Pharma is high on healthcare reform, look no further than General Motors. The automotive giant that ushered in the age of employer-based insurance will now offer only high-deductible health insurance to salaried workers. It's just one sign of the continued shift of healthcare costs from employers to workers themselves. According to the Wall Street Journal Health Blog, a recent survey found nearly two-thirds of employers plan to require workers to foot more of the healthcare bill, via higher premiums, bigger deductibles and copays, and the like.

And why should drugmakers care? Consider the copayment assistance plans that Big Pharma has implemented. Recognizing that insurers are pushing patients away from costly branded meds by jacking up copays, drugmakers have taken on part of that expense. They'll foot the bill for a big chunk of the copay to get patients to use their meds instead of cheaper generics.

When companies go to high-deductible insurance, most require patients to pay for their own meds until they meet that deductible, which in GM's case will be $1,300 for individuals and $3,100 for families. The patients may get discounted prices, but rather than a high copay of, say, $70, for a costly branded drug, they're required to pay the entire $200-plus freight.

So as that two-thirds of employers shifts workers to high-deductible plans--and/or hikes up their copays--Big Pharma will have a tougher and tougher time selling branded drugs. To entice patients, they'll have to greatly expand those copay-assistance programs, hand out more coupons, even slash retail prices. But if an effective version of healthcare reform passes, more people will get better health benefits. And pharma will benefit, too.

- read the Health Blog post [1]

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