by Jill Nolin, Georgia Recorder [This article first appeared in the Georgia Recorder, republished with permission]

April 3, 2023

A bipartisan measure that would require prescription drug discounts to be shared with Georgia consumers stalled in the Senate.

The bill centered on pharmacy benefit managers, which act as the go-between for health insurance companies and prescription drugmakers. Acting on behalf of insurers, these pharmacy benefit managers negotiate discounts in the form of rebates with the manufacturers.

“Unfortunately, oftentimes the PBM keeps much or all of that rebate rather than passing the discount or the benefit of the discount through to the patient,” said Rep. Mark Newton, an Augusta Republican who is sponsoring the bill.

Newton tried to make the case this session that lawmakers should intervene and require these third parties to share the savings with consumers in hopes of lowering their out-of-pocket costs, particularly when it comes to newer medications.

“They’re making that profit and a lot of what they’re making it off of is not passing it through to reduce premiums but passing it through to their shareholders, which normally I don’t mind until it becomes excessive,” Newton said. “And when excessive profit desire hurts patients, I think that’s our obligation to step in at that point and defend the patient.”

Under the bill, pharmacy benefit managers would have to share at least 50% of the rebate with patients, although the changes would not apply to anyone covered by federally regulated health insurance plans.

The proposal, which also includes reporting requirements meant to increase transparency, sailed through the House with a 168-to-3 vote early last month. But it stalled in the Senate Health and Human Services Committee in the final days of the session when it was narrowly defeated with a 5-to-6 vote.

Newton’s bill ran into opposition from insurers, pharmacy benefit managers and the National Federation of Independent Business, which represents small businesses. Opponents argued the measure was unnecessary because point-of-sale rebate plans are already available to employers and the changes called for would drive up costs for everyone.

Newton acknowledged premiums would likely increase but said it would be minimal. He also argued his bill could lower costs in the long run if prescriptions are more affordable, helping patients to take them more consistently.

But the proposal also ran into some skepticism about its potential to help consumers.

“It seems to me that the problem is that the prices of these drugs are extraordinarily high,” said Sen. Kim Jackson, a Stone Mountain Democrat. “And I’m having a hard time understanding how this changes that. So what would prevent a drug company from just continuing to increase the price while offering a rebate?”

The bill remains alive for next year, and advocates say they will be back again.

“Insurers and PBMs are in this fight for their profits. Patients are in this fight to save our lives,” said Dorothy Leone-Glasser, executive director of Advocates for Responsible Care.

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