The systemic problem: Overview
The U.S. prescription drug market is a textbook case of waste and inefficiency — one that, in recent years, has disproportionately benefited a handful powerful corporations at the expense of providers, and the patients they serve. Nowhere are those inequities more pronounced than in prescription prices available to 340B entities — whose legal rights to cost-savings are increasingly under fire from drug manufacturers and a group of PBMs we’ll call The Big 3.
Collectively, The Big 3 (CVS, ESI and Optum) generated an estimated $480.3 billion in revenue in 2024; whereas in 2022 (the latest years for which figures are available), some $2.58 billion was redirected from 340B health systems and patients through predatory pricing strategies. Strategies steering patients to PBM-affiliated pharmacies, and imposing unfavorable reimbursement rates. Additionally, it’s estimated that in 2024 the average 340B hospital lost nearly $3 million to unlawful drug manufacturer pricing restrictions.
The negative impact on 340B patient outcomes. And provider incomes.
The Big 3’s inordinate market power has enabled them to control where prescriptions are filled, and by whom — eroding prescriber and hospital clinical authority. Under this arrangement, they routinely push hospitals and providers to prescribe drugs with the highest rebates for themselves.
That’s a problem from both a cost standpoint AND a transparency standpoint. The Big 3 negotiate rebates and discounts with drug manufacturers, but they are not required to disclose how much of those rebates are passed-on to health plans or patients. They also control the formularies for high-cost specialty drugs, often steering patients toward specific drugs and/or pharmacies that maximize their profits — rather than focusing on cost-effectiveness or, worse still, patients’ best interests.
Lining their own pockets, while everyone else suffers.
What’s more, The Big 3 routinely under-reimburse independent pharmacies for prescriptions, making it difficult for them to stay in business. They also routinely prioritize their own affiliated pharmacies, such as CVS Caremark, Accredo and OptumRx — three of the largest pharmacies in the United States, where corporate policies all-but guarantee an emphasis on prescription-processing volume over individual patient care and education; not to mention provider support, particularly when those Big 3-owned pharmacies are remote, and there is no incentive to provide patient-care support.
Take it or leave it? Not anymore.
By joining forces with Maxor, ProxsysRx now provides 340B health systems access to prescription drugs for their own retail and specialty pharmacies — on a pricing basis that’s similar to the cost-plus model.
Rather than being at the mercy of The Big 3, the hospitals we serve now have the ability to design their own formularies and networks. Which means you determine the margins your on-campus pharmacies generate on prescriptions, ensuring that those pharmacies operate on a positive-revenue basis — while, at the same time, enabling you to drive the lowest possible costs for prescriptions (including high priced specialty drugs), and pass-along your lower prescription costs to your patients and employees.
Our model includes no rebate percentage to Maxor / ProxsysRx — just a nominal Admin fee for processing each prescription.
Full pricing and patient-care control for 340B hospitals.
When ProxsysRx manages your health system’s 340B program, your providers (working with your 340B team and ours) can choose — on a per-prescription basis — whether to take the associated rebate price of a drug or the discounted 340B price on each 340B-eligible prescription. So not only will your health system benefit from lower pricing, you and your patients will benefit from the full transparency we offer you on every prescription.
By having access to comparative-medication pricing information, your pharmacists can work with your physicians to select prescriptions that best serve each patient individually. For instance, when a patient can’t afford Best In Class medications, your pharmacists can search a broad range of different funding options, or work with their provider to recommend the Best Alternatives that they can afford.
Medication and pricing options delivered instantly.
When paired with the Maxor+ PBM, ProxsysRx’s 340B software automatically provides your providers, pharmacists and 340B team members the comparative values of rebates vs. 340B savings — enabling them to quickly and easily choose which option to choose for every 340B-eligible prescription.
Everybody wins.
In addition to providing lower prescription prices to your pharmacies and patients, your hospital (and other employers in your community, for that matter) can offer those same low prices to your employees — and, in the process, reduce the costs of your self-funded health plan.
ProxsysRx is here to help.
To learn more, contact Howard Hall: C: 214.808.2700 | howard.hall@proxsysrx.com