Ian Read, Pfizer's CEO, believes the controversial rebates drugmakers pay to pharmacy benefit managers will soon vanish, according to STAT.
During a July 31 conference call to discuss the company's second-quarter earnings, Pfizer's chief executive said he thinks the Trump administration will stop the practice of allowing rebates on prescription drugs and suggested that drug-pricing reforms may focus on the middlemen rather than the drugmakers themselves.
"I believe we are going to go to a marketplace where we don't have rebates," Mr. Read said on the conference call, according to STAT. "Rebates are going away."
While it is unclear whether Mr. Read is right, several moves by the Trump administration suggest he is. In July, HHS proposed overhauling safe harbor protections, which shield drugmaker rebates made to PBMs from antikickback statutes. If the proposed changes are accepted, it could reshape how prescription drugs are priced and sold. In addition, President Donald Trump has regularly placed the blame on rising drug prices on the middlemen, or PBMs, according to Reuters.
Rebates, which are the discounts drug makers provide PBMs off the list price, have been involved in the debate about drug prices for years.
Drugmakers claim that PBMs, who keep a percentage of the rebates, demand higher amounts each year to bolster profits, and as a result they must increase the list price of the drugs. PBMs argue that rebates prevent the price hikes that drugmakers regularly impose to increase their own profits.
Read the full STAT report here.