The Federal Trade Commission (FTC) will boost enforcement and scrutiny against drug rebates that could block patient access to cheaper pharmaceuticals shortly after the agency announced a probe into pharmacy benefit managers.
The agency issued Thursday an enforcement policy statement (PDF) that targets rebates and fees which can prohibit competitors from targeting lower-cost drug alternatives. FTC outlined what rebates or fees could spark a move against a PBM or other intermediary, which could potentially result in fines or penalties.
“Today’s action should put the entire prescription drug industry on notice: when we see illegal rebate practices that foreclose competition and raise prescription drug costs for families, we won’t hesitate to bring out full authorities to bear,” said FTC Chair Lina Khan in a statement.
The FTC has charged that rebates could be driving up prices of vital drugs such as insulin, the list price of which has increased by more than 300% in recent decades.
The agency’s policy statement said it will go after “exclusionary” rebates which cut off competition from a less expensive alternative like a generic or a biosimilar. It also targeted actions that entail “including prescription drug middlemen to place higher-priced drugs on formularies instead of lower-cost alternatives” in a manner that shifts costs to payers and patients.