S&P Global Ratings released a report Jan. 21 detailing its predictions for the pharmacy benefit manager industry in 2020.
The financial services corporation said it has a negative outlook for the PBM industry this year, particularly for smaller, subscale PBMs.
Four key takeaways from the report:
- The risk for legislation that could hinder the PBM industry is significantly reduced in 2020, because it is an election year, according to the agency.
- S&P doesn't expect proposals that would ban rebates — the discounts drugmakers pay to PBMs — to return anytime soon. In addition, S&P thinks there is limited political appetite to target spread pricing with legislation, as the Congressional Budget Office projected only $1 billion in savings in 10 years with limiting the tactic. Spread pricing occurs when PBMs charge health insurers more for a drug than it reimburses a pharmacy to dispense the drug.
- Middle-market PBMs will likely consolidate to keep up with their larger peers like CVS Caremark, OptumRx and Express Scripts, S&P said.
- The agency also expects negative political rhetoric to emerge about PBMs during the 2020 presidential election.