- Reuters reports that Oklahoma is the first state where its Medicaid program is negotiating prescription drug prices based on how well they work in practice. CMS signed off on allowing the state to employ the approach two months ago.
- The first contract to be inked was with Alkermes plc (ALKS -1%) for schizophrenia med ARISTADA (aripiprazole lauroxil). The agreed-upon price decreases every other month as long as the prescription is refilled (compliance with drug regimens is a major problem in this patient population). The longer the patient takes the drug, the better the rebate.
- Contracts for an expensive antibiotic and an epilepsy drug are nearing completion.
- By law, state Medicaid programs, key buyers in the $450B U.S. prescription drug market, received a mandatory 23% discount of list which, of course, does nothing to constrain costs since most drug companies hike prices one or two times each year. State Medicaid administrators often negotiate additional rebates for individual medicines.
- Michigan is reportedly pursuing CMS approval to try its hand at Oklahoma's initiative. Colorado says it is in the "early planning stages" for a similar move.
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