Our lobby and communications team have been in high gear the past few weeks, preparing for Friday's hearing in the Texas House of Representatives regarding transparency in PBM contracts with the state.

 

Some of you may remember our first run at PBM reform was two sessions ago. Our bills that had sailed through the Senate were "snatched from the jaws of victory" by a last-minute point of order. Prior to the past session we had a hearing on the Senate side that focused more on PBMs in general. The resulting transparency legislation sponsored by Rep. Callegari was on the road to victory when it was derailed, along with hundreds of other bills, by the brouhaha surrounding Speaker Tom Craddick and efforts to dethrone him.

 

This time our hearing is concentrating on how the Employee Retirement System and the Teacher Retirement System could save millions of dollars in taxpayer money.

 

Inertia creates its own force, so making changes, even those that obviously save money, is requiring some education. Fortunately, the joint committee led by Rep. Bill Callegari and Rep. Vicki Truitt is amenable to learning more and leading change.

 

Richard update: Richard's health continues to improve, and despite our admonitions to take it easy, is spending way too much time on the computer!

A football injury at age 16 resulted in a two-month hospital stay for Robert Kinsey.

 

"That was back when they left the chart on the foot of the bed for the nurses," he said. "I got to looking at the chart and got interested. I was frustrated because I couldn't read it and I began asking questions."

 

And that's when he decided to become a pharmacist.

 

Robert graduated in 1966 from The University of Texas and went to work for an independent pharmacist in Irving. By 1973 he moved back home to Tyler and worked a few years for an independent chain. He and a friend opened their own shop, and Robert ultimately went out on his own in a 1,000-foot space with one employee.

 

Today, Kinsey's Pharmacy occupies 3,500 square feet and has 12 employees in addition to himself. Each innovation, from their first computer in '83 to the integrated voice recording telephone system he unveiled this week, has been "a benefit not just to the store but to our customers," Kinsey said.

 

He prepared his clientele for the telephone system change with letters explaining how it works and reports most people were actually pleased at the convenience. "For those who didn't like it, we told them how to over-ride the system to talk to a person."

 

"I don't worry too much about independents, we will always survive," he said. "I was here before Walgreens and Wal-Mart, and I'll stay here."

 

Independents need a niche of their own, he advises.

His store features a compounding section, delivery service, and of course, very personalized service. "Everyone is greeted by name when they come in, and thanked when they leave," he said.

 

Kinsey recommends the profession to young people--where else can you make $90,000 right out of school and even get a $15,000 signing bonus with some of the chains? And they can work anywhere they want to, he said.

 

Whether to be an independent is a personal choice, according to Kinsey. Some people like owning their own business and some don't. For Kinsey, it's been the right choice since he was 16!

Texas Attorney General Greg Abbott has resolved a lengthy multi-state Medicaid fraud investigation involving drug giant Merck & Co. Under the $671 million global settlement agreement, the state of Texas will receive nearly $16 million.

 

The states' investigation into Merck stemmed from Federal Medicaid Drug Rebate statute violations. Under federal law, drug manufacturers are required to report their "best prices" to state Medicaid programs. Those reduced prices are used to calculate rebates that manufacturers owe when Medicaid overpays for pharmaceutical products. The law ensures that the government-funded health care program obtains the best possible price for the manufacturers' drugs.

According to investigators, Merck sold its Vioxx and Zocor products to certain hospitals for 92 percent less than the catalog price. The deeply discounted price, which was offered to high-volume hospitals, was used in an attempt to increase the products' market share. Merck did not report the dramatically lower price to the government, and therefore did not rebate the price difference to the states' Medicaid programs. Vioxx was prescribed as a painkiller, while Zocor is used to fight high cholesterol.

The agreement also settles a similar drug pricing program investigation involving another Merck product, Pepcid, an antacid used to treat ulcers. Just as it did with Vioxx and Zocor, Merck gave hospitals an array of discounts of up to 92 percent on Pepcid tablets. The pharmaceutical manufacturer offered lesser discounts on other Pepcid formulations. Its Pepcid pricing program featured "bundled" prices, thereby requiring Merck to adjust the "best price" among the different formulations in order to reflect the discounts.

 

Because the company failed to show these discounts in its "best price" reports to Medicaid, it avoided paying millions of dollars in rebates to state Medicaid programs.

 

A separate Texas-based Vioxx case, filed in June 2005, is still pending in state district court. In that case, the Attorney General alleged Merck suppressed critical information to physicians, patients and the Texas Medicaid program about the health risks associated with Vioxx. As a result, Texas paid in excess of $72 million for Vioxx prescriptions for Medicaid recipients.

 

 

 

 

 

Lynn Everett, RPh

 

 

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newsletter issues are online at www.aprx.org/news. Check out the Hot Issues link for a wealth of information on everything from participating in the political action committee (GPAC) to requirements for tamper-resistant prescription pads.