CHC DC Meeting: Prescription Drugs Are Cost Savers, Not Cost Drivers

Oct. 26, 2015 – There is no question that prescription drugs have a cost to patients and payers, but that cost is more than offset by the value those drugs provide, according to several speakers at a session of the Coalition for Healthcare Communication (CHC) meeting held Oct. 21 in Washington, D.C. Key action steps mentioned by the speakers included: (1) strengthening the public’s perception of drugs not as cost drivers, but as cost savers; (2) working to solve the patient drug access problem; and (3) building a collaborative environment that will foster innovation and drug development.

“Questions about cost and value are really important,” said Richard Bagger, senior vice president, Corporate Affairs and Market Access, Celgene. “Medicines are a small and declining share of healthcare spending growth from 2009-2013, representing only 4 percent of healthcare expenditure growth,” he said, noting that these facts do not necessarily match the public’s perception of drug spending. As such, pharmaceutical companies “have our work cut out for us.”

The Pharmaceutical Research and Manufacturers of America (PhRMA) is working both on its own and with its members to improve the reputation of the prescription drug industry. “We need to put the costs of medicine into perspective,” according to Robby Zirkelbach, senior vice president of Communications, PhRMA. “We need to highlight the value of medicine and we have a great story to tell,” he said. “What’s going on in the cancer space is nothing short of miraculous, but that story is getting lost.”

PhRMA is focusing on data-driven communications (via chart packs available at, leveraging paid media to reach the target audience (as well as social media and other ad media), and highlighting the value of medicines via its “From Hope to Cures” platform, Zirkelbach stated.

Bagger told CHC meeting attendees that spending on prescription drugs represented only a fraction of the healthcare dollar (9 cents) in 2012, while hospital care spending took up roughly one-third of that dollar (32 cents) that year. However, what the public often does not realize is that medical innovation since 1990 has resulted in a 70-percent decrease in hospitalization, and that new therapies lower the cost of care. In the cancer specialty, when cancer medicine spending increased by 179 percent, the overall costs of cancer care dropped by 34 percent, he said.

One of the most significant barriers to healthcare progress is providing patients access to the medications they need, Bagger explained. This barrier often is due to insurance benefit design, which can negatively affect both access and outcomes. He stated that increased cost sharing through co-insurance has been shown to decrease medication adherence. “25 percent of cancer patients stop treatment when costs per month exceed $500,” Bagger continued. When that happens, “from my perspective, that is a failure of insurance,” he said.

Most companies have patient assistance programs that provide low-cost or free medications to low-income or uninsured patients. “Affordability of medicines is a challenge,” Zirkelbach said. “Connecting people to medicines and the companies that make those medicines is important.” To that end, PhRMA is helping patients access the medicines they need though a revamped Partnership for Prescription Assistance (PPA) program. It also has launched an “Access Better Coverage” (ABC) campaign (which includes new Spanish language resources) highlighting patient access barriers, as well as a “Burden on Patients” series, he explained.

Moving forward, Bagger suggested that the drug industry and the government should “build on policies that work,” such as Medicare Part D, and work together to modernize insurance benefit design to help ensure patient access. “It takes an ecosystem of public, private, patient and academic entities to collaborate on solutions for healthcare delivery and policy, and it’s much more productive than fighting within the system,” he said.