Pfizer's Lipitor survival strategy under attack
Remember Pfizer ($PFE) CEO Ian Read's (photo) promise that Lipitor co-pay assistance wouldn't "disadvantage" payers? Apparently, this is why: The company has struck some aggressive deals with pharmacy benefits managers and healthcare plans, trading large discounts for restricted access to Lipitor generics.
In a complete reversal of the usual push toward newly available generics, PBM Catalyst Rx has instructed pharmacies to fill prescriptions for generic Lipitor with the branded version instead, according to a letter obtained by The New York Times. The generic block would remain in effect until the end of May 2012, when Ranbaxy Laboratories' 180-day exclusivity is expected to expire and additional copycat versions will hit the market. Patients would still pay a generic-level co-pay for their prescriptions.
According to Bloomberg, Medco Health Solutions ($MHS) is also participating in the generic-blocking deal. Reimbursements for generic Lipitor would be denied, while coverage for the branded version would remain in force. A spokeswoman called the arrangement--which applies to Coventry Health Care members, if not other plans as well--a "custom plan design," Bloomberg said, under which Medco customers tweak their formularies to "maximize value" and achieve their benefits-management goals.
Some pharmacists are up in arms about the arrangements, saying Pfizer and the PBMs will benefit at the expense of employers--who'll still pay the brand-name drug fee--and taxpayers. Pharmacists United for Truth and Transparency, a trade association of 600 independent pharmacists, called the PBMs' approach a "blatant attempt" to "retain rebate dollars" from Pfizer, Bloomberg says.
"While the Lipitor co-pay will drop on Nov. 30, the full price to plan sponsors will stay the same," a group spokesman told the news service. "That means plan sponsors will be forced to pay more for brand Lipitor even though a low cost generic is available."
Paul Bisaro, CEO of Pfizer's authorized-generic partner Watson Pharmaceuticals ($WPI), told the Times that the arrangements would raise healthcare costs, not to mention hurt his attempts to sell a Lipitor copy. "It's not a good event," he told the NYT. "And consumers are going to be confused. They're not going to understand why they can't get a generic."
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