The surprising group that will be hit hard by drug pricing reform

DATE: October 17, 2022

By Rachel Cohrs

Obviously, pharmaceutical companies are upset that they’re going to lose money from Medicare under Democrats’ new drug pricing law. But there’s another, less obvious group that’s concerned as well — long-term care pharmacies that serve almost entirely Medicare patients, and dispense the drugs that will likely enter the price negotiation program first. 

While long-term care pharmacies support lowering drug costs, they’re also worried about whether their bottom lines will take a hit as a result, said Alan Rosenbloom, president and CEO of the Senior Care Pharmacy Coalition. They aren’t paid a percentage of the costs for the drugs they dispense, but lower prices will mean smaller pools of discounts for groups like insurers, wholesalers and pharmacies. 

“Pharmacies shouldn’t be collateral damage. We didn’t cause high prices,” Rosenbloom said in an interview with STAT.

The two biggest long-term care pharmacy companies are Omnicare, which is owned by CVS Health, and PharMerica, which is owned by private equity firm KKR.

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