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Lawmakers urge 'thorough' FTC review of PBM merger
October 24th, 2011
ALEXANDRIA, Va. – More than a dozen members of the House of Representatives have sent a letter to the Federal Trade Commission to note their misgivings about the proposed merger of pharmacy benefit managers Express Scripts Inc. and Medco Health Solutions Inc.
The letter to FTC chairman Jon Leibowitz, which had Congressional Community Pharmacy Caucus co-chair Rep. CAthy McMorris Rodgers (R., Wash.) as the lead signer, reflects "a growing chorus in the U.S. Congress" voicing concern about the PBM merger deal, the National Community Pharmacists Association said Monday.
"We are writing to express our concerns with the recent merger announcement between Express Scripts and Medco and to request that your office conduct a full and thorough investigation, including examining the impact that the merger will have on consumers, patients, [and] third-party and federal payers," the letter stated.
"On its face, the merger demonstrates the potential for a combined entity to dominate an already heavily concentrated market," the lawmakers noted.
Besides McMorris Rodgers, the letter was signed by House members Robert Aderholt (R., Ala.), Spencer Bachus (R., Ala.), Joe Bonner (R., Ala.), Mo Brooks (R., Ala.), Judy Chu (D., Calif.), Maurice Hinchey (D., N.Y.), Ruben Hinojosa (D., Texas), Tom Marino (R., Pa.), Mike Rogers (R., Ala.), Martha Roby (R., Ala.), Terri Sewell (D., Ala.), Peter Welch (D., Vt.) and Don Young (R., Alaska).
Last month the FTC issued a "second request" with the two PBMs for information on the agreement, a move applauded by pharmacy industry groups.
Announced in late July, the $29.1 billion Express Scripts-Medco merger deal would create the nation's largest PBM with about a third of the market in terms of prescription drug volume.
NCPA noted that Sen. Tom Harkin (D., Iowa), chairman of the Health, Education, Labor & Pensions Committee, also expressed concerns about the PBM merger in a letter to the FTC. "I am concerned that combining two of the country's three largest PBMs might lead to reduced competition, less consumer choice, decreased access to pharmaceutical services, and ultimately higher prescription drug prices for health plan sponsors and consumers," Harkin wrote in the letter.
In addition, NCPA reported that congressional staff have confirmed plans by Sen. Herb Kohl (D., Wis.), chairman of the Senate subcommittee on antitrust, competition policy and consumer rights, to hold a hearing next month to examine the merger. That would follow a Sept. 20 hearing of a House Judiciary subcommittee led by Rep. Bob Goodlatte (R., Va.), the association said.
"The U.S. Congress is clearly taking a much-needed and forceful role in favor of rigorous oversight of the proposed Express Scripts-Medco merger, clouding the once-certain forecasts of the deal's approval," NCPA CEO B. Douglas Hoey said in a statement. "Legislative time is at a premium, so these two hearings represent a major statement of congressional concern over this merger. These developments also demonstrate NCPA's tireless and coordinated efforts in opposition to the merger."
Separate letters also have been sent by Sen. Kent Conrad (D., N.D.) and Reps. Joe Courtney (D., Conn.), John Conyers (D., Mich.) and Jan Schakowsky (D., Ill), according to NCPA, which added that at least 29 state attorneys general have formed a working group to conduct their own examination of the PBM merger.
"The bottom line is this merger would reduce patient choice and access to pharmacy services and ultimately result in higher prescription drug costs, as history has shown," Hoey stated. "Putting more than 50% of the U.S. specialty drug market and close to 60% of the mail order market in the hands of just one, growing company would be a recipe for disaster for patients, employers, government agencies and other health plan sponsors. We thank all the members of Congress who vocalized their uneasiness with the merger's impact on the marketplace after hearing the concerns of consumers and pharmacists, which NCPA has and will continue to deliver to Capitol Hill and elsewhere."