What the CVS-Aetna deal means for the future of health care
When drug company chief executive Heather Bresch was hauled in front of Congress last year to defend the high price of lifesaving EpiPens, she drew skeptical lawmakers' attention to a large poster board that blamed the skyrocketing price tag on a coterie of drug supply chain middlemen. Of EpiPen's $608 list price, her company, Mylan, received only $274, Bresch said.
"What the patient is paying is not . . . coming back to Mylan," Bresch said. "And when we were speaking earlier of the people, the middlemen in the system, that's either the pharmacy benefit managers, retailers, wholesalers, insurers."
That supply chain — rarely seen by most consumers — is the center of attention in the corporate world after CVS Health announced a $69 billion deal to buy Aetna, the nation's third-largest insurer.
Familiar as a corner drugstore, CVS Health actually makes most of its money from one of the most lucrative points along the supply chain as a pharmacy benefit manager, negotiating drug prices for health insurers and employers.
The deal comes at a time when health care is in flux, moving toward preventive care and managing chronic conditions— while shifting more of the cost of medicine onto customers through high-deductible health plans.
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