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Coupons, Vouchers Used for Few Prescription Drugs

Pills and dollar bill

(Thomas Breher, Pixabay)

30 Mar. 2021. An analysis of customer transactions shows discounts from suppliers are used for only a small fraction of prescription drugs on the market. Findings from a study conducted by researchers at Johns Hopkins University public health school, appear in yesterday’s issue of JAMA Internal Medicine (paid subscription required).

A team led by health economist Aditi Sen aims to discover the extent prescription discounts offered by drug makers or pharmacy benefit managers are used by consumers, and how much they truly offset their out-of-pocket costs. These discounts, offered in the form of coupons, vouchers, or co-pay offsets, are often publicized by pharmaceutical companies as a way of reducing high costs of prescription drugs for their customers.

The Johns Hopkins team analyzed purchase transactions for prescription drugs maintained in a database offered by health care analytics company IQVIA. The researchers collected data on purchases by more than 631,000 individuals from October 2017 through September 2019, where the buyers used at least one discount. In this two-year period, these individuals requested some 33 million prescriptions, with a majority of the purchasers (57%) being female, and an average of nearly 46 years.

The results show half (50%) of the discounts used are offered by drug manufacturers, while nearly as many (47%) come from pharmacy benefit managers that manage prescription drug benefits for insurers, large employers, and Medicare. The remaining three percent are offered by state assistance agencies. The discounts come in various forms, such as discount cards and smartphone apps used by consumers, or as coupons offered by pharmacy chains.

Discounts for both branded and generic drugs

Drug manufacturers offer discounts mainly for their branded products, representing 88 percent of the manufacturers’ discounts used by customers. Pharmacy benefit managers or PBMs, on the other hand, offer discounts primarily for generic drugs, which represent 91 percent of those customer discounts. The discounts are used largely for drugs treating cardiovascular and respiratory diseases and diabetes.

Nonetheless, the findings show discounts used for both manufacturers’ and PBM’s products are concentrated in just a small fraction of the drugs offered by these companies: 80 percent of the manufacturers’ discounts are used for 164 products or six percent of all products they offer, while 80 percent of the PBM discounts are used for 156 or five percent of their product offerings.

Customers generally receive larger discounts from manufacturers than PBMs, medians of $51.00 and $16.00 respectively, which reflects their respective emphasis on branded versus generic drugs. The team also found people using discounts are distributed about evenly across different income levels, races, ethnic groups, and type of insurance coverage. And the researchers point out, as a result, that those groups probably most in need of discounts are not more likely to receive them.

“The most significant finding was that these offsets are not being targeted to people who likely need them the most,” says Sen in a university statement, “for the pharmaceutical company-sponsored offsets, the goal may be mainly to maintain market share. Understanding different offset types and which patients use them is important for designing policy.”

The team is extending its work to find out more about how companies make decisions to offer discounts and how offsets may influence health outcomes of customers.

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