CVS Alleged Scheme to Defraud Consumers
CVS In Legal Hot Water
Alleged Scheme to Defraud Pharmacy Consumers
It’s no secret that Big Pharma has been raking Americans over the coals by jacking up drug prices, but how far some will go came as a shock! A lawsuit was filed by Hausfeld Firm one week ago, against CVS Health Corp. Allegedly CVS Pharmacy has been submitting falsified claims to insurance companies with inflated prices since 2008. Kristen Broz, the attorney that filed the lawsuit for the 7 plaintiffs stated, “We’ve seen people who pay $20 for a 30-day supply as their copayments on a drug that was $11.99 for a 90-day supply had they been in CVS’s Health Savings Pass program” (Yahoo Health News). CVS’s Health Savings Pass program offers discounts on generic prescription medications to patients that don’t have insurance or decide not to use it to try and save more money. This program includes popular generic forms of Prozac and Penicillin. “Instead of presenting insurance companies with that discounted price, CVS reported the higher price that a normal retail customer not in the Health Savings Pass would pay” (Yahoo Health News).
On top of the higher payment they were receiving from insurance companies, CVS was also collecting higher copayments from patients for the higher price they were submitting to the insurance. This fraudulent program allowed CVS to increase its market share, fight off discount prices from competitors, and hide its usual prices from third-party payers. It is estimated that hundreds of thousands of people may have been scammed and affected by this scheme. These accusations echo the accusations made by David Morgan, a licensed pharmacist that accused CVS and other Big Pharma companies of pulling this scam in December of 2013. Unfortunately the case was dismissed, but it was alleged that these companies were submitting billions of these false claims as early as 2001 (Courthouse News Service).
References:
Medication Errors
Medication Errors
According to the Centers for Medicare and Medicaid Services, the number one cause of re-admittance to the hospital is non-compliance to medication. The FDA reports that since 1992 they have received notification of a startling 30,000 medication errors and more than 7,000 deaths a year as a result. This count does not include the number of medication errors that go unreported. “One study showed that more than half of patients at hospitals nationwide had an error in their medications, such as the wrong drug, the wrong dosage, the wrong frequency, or a potentially dangerous interaction with another drug” (bsahs.org). One report from the FDA included a situation where a physician ordered a 260mg prep of Taxol, but the patient received 260 mg of Taxotere from the pharmacist instead. This mistake cost the patient their life a few days later. It’s easy to make this type of mistake when we get into a routine. The steps and precautions pharmacists take can become mundane and “second nature”, which can become ineffective and dangerous for patients. When we mindlessly go through the motions, accidents are more likely to occur.
The FDA is working on different strategies to reduce the occurrence of medication errors. Drug name confusion, as in the example above, is a big cause of medication errors. “To minimize confusion between drug names that look or sound alike, the FDA reviews about 300 drug names a year before they are marketed. ‘About one-third of the names that drug companies propose are rejected,’ says Phillips. The agency tests drug names with the help of about 120 FDA health professionals who volunteer to simulate real-life drug order situations. ‘FDA also created a computerized program that assists in detecting similar names and that will help take a more scientific approach to comparing names,’ Phillips says” (FDA.gov). The rejection of certain drug names that sound like a medication already on the market is one action the FDA has taken in the fight against medication errors.
What can you and your pharmacists do to decrease medication errors in your area? How about changing your precautionary steps every quarter to reduce errors due to mundane repetition? What other ideas do you have?
A Hospital Minimizing Risk & Creating Jobs for Pharmacists
I think we can all agree that it will take change and testing different strategies to come up with long term solutions to reducing medication errors. A great idea we came across in an industry blog to reduce medication errors is a new two-part process that the Pharmacy Department at BSA Health System in Amarillo, Texas has implemented. Four pharmacists will now be staffed for patient education upon discharge to ensure patients fully understand how to take their medications before discharge preventing unnecessary readmissions, and four additional pharmacists assigned solely to the ER Department to perform medication use evaluation for each patient. Their goal is by educating and making sure each patient is well informed on the importance of each medication, they hope to see a significant improvement of proper medication usage within their patients including a reduction in medication errors.
References:
http://www.bsahs.org/blog/new-pharmacy-programs-aim-avoid-medication-errors
http://www.fda.gov/Drugs/ResourcesForYou/Consumers/ucm143553.htm
http://www.pharmacytimes.com/publications/issue/2010/january2010/p2pdispensingerrors-0110
AARP Report Posted On Price Inflation for Generics
AARP Report Posted On Price Inflation for Generics
The price of some generic drugs that have been around for years are starting to climb again even after some relief in 2014. As you know with the Pharmacy Industry being a free market, big brand name Pharma companies can capitalize on their existing patent by driving up drug prices because no other company can provide that medication. Once this patent expires, generic drug manufacturers can then create this medication and sell it for a fraction of the cost. This past May, the AARP Public Policy Institute (PPI) released a report regarding drug prices that showed in 2013 there was a 4% decrease in the cost of generic drugs, which is the slowest rate of decline in the previous seven years.
About 27% of generic drugs listed in the AARP PPI had a rise in drug prices, and the price of 97% of brand name drugs increased. A common generic drug that caused “sticker shock” was Doxycycline Hyclate (100mg, 500 count) that went from $20 to a gut wrenching $1,849 in April 2014 (Trxade currently has it listed for $259.39 wholesale). Even though Doxycycline Hyclate has lowered since last year, it is still over a 1,200% increase from 2013. I spoke with a customer at the Pharmacy last week who said her generic birth control that usually costs $5, is now $35 a month. How did this medication become 7 times more valuable overnight?
That’s a trick question because it didn’t! Even pharmacists are confounded by this change; “When we polled our members about a year ago, they were experiencing a rash of dramatic price increases for generic drugs,” says Kevin Schweers, a senior vice president of the National Community Pharmacists Association, which represents small independent drugstores. “Some of the rises occurred virtually overnight. And it continued to snowball and impact more and more medications” (aarp.org). Generic drug price inflation has been so steep lately, that the Senate Subcommittee on Primary Health and Aging held a hearing to investigate. There is no easy answer as to why generic drug prices have soared to double their original price and in some instances as we have highlighted have even risen to over 1,000%!
Some think it’s due to less competition from mergers, others believe it could be caused by an increase in production cost, but the majority of us know that it is most likely unfounded. Panic is starting ensue for the uninsured as they won’t be able to afford some of the generic medications they have grown accustomed to getting at a fraction of the cost, Medicare recipients will experience higher copays or higher percentages, and all taxpayers should be on alert as we take on the responsibility of paying half of the bill for all prescription drugs through government programs. There’s no easy solution on how to combat this unruly price inflation, but further government regulation, price transparency, additional competition (including China which we covered last week), and a simpler coverage system could help.
References:
http://www.aarp.org/health/drugs-supplements/info-2015/prices-spike-for-generic-drugs.html
Teitelbaum, J., & Wilensky, S. (2nd Ed., 2013). Essentials of Health Policy and Law. Burlington, MA: Jones & Bartlett Learning, LLC.
Will “Made In China” Be Good For The Pharma Industry?
Will "Made In China" Be Good For The Pharma Industry?
In the past medications from China were looked down upon and not trusted by many physicians around the world, including their own Chinese doctors. These medications are completely unregulated and have not been approved by the Chinese FDA. On appearance alone, many of the medications look identical; however, these medicines are dangerous and even fatal partly due to a lack of expertise, a shortage of quality manufacturing facilities, a small pool of talent to choose from, and a slow approval process by the State Food and Drug Administration (SFDA).
Gradually they are raising the standards of their drug manufacturing processes. Some Chinese pharmaceutical companies are even partnering with American pharmaceutical companies to ensure better quality and a higher efficacy rate. These partnerships and the government’s efforts to incentivize privately owned businesses in China could revolutionize the pharmaceutical industry bringing costs down. Do you think this could have the potential to reduce drug prices in the U.S.? It does seem to be plausible.
Get an Additional $30-$50 on Diabetic Claims
The voice of the customer is extremely important to us. When you speak, we listen. Did you know that if you ‘TRxADE it”, you can not only save money on insulin, but you can also save money on complimentary DME products as well? Last week Courtney with Shellman Drugs in Shellman Georgia reached out to us to let us know due to TRxADE they are making an additional $30-$50 per claim by purchasing insulin, syringes, and test strips on the TRxADE buying platform.
TRxADE is your one-stop-shop for all your Diabetic needs. We compare prices for several insulin suppliers, but also for syringes and test strips as well including overstock from peer pharmacies where allowed by state law.
Courtney may look familiar as two weeks ago we received a testimonial that due to TRxADE’s savings they went their first week in years without negative losses on reimbursements!
TRxADE it!
Before you place your order with your Primary or Secondary’s, TRxADE your order and compare pricing before buying! Save on medications especially with negative reimbursements. Many pharmacies have grown accustomed to rebates, high volume discounts or kickbacks. When you TRxADE it you get immediate savings, and hard cash immediately back into your pharmacy’s bottom line instantly. Stay profitable fellow pharmacies and join in our fight to ensure Independent Pharmacies Thrive, not just Survive! What are you waiting for? TRxADE it today!
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Drug Shortages On The Rise
Drug Shortages On The Rise
Global shortages of drugs are causing unnecessary surgeries, relapses of cancer, and even fatalities in the U.S. This is an ever-increasing problem that could affect you, your business, and your loved ones. In just five years, the shortage of drugs in the U.S. has risen to an amazingly high, 74%. The shortage has a broad coverage of drugs, from saline and anti-inflammatories to cancer treatments and anesthesia (Loftus, 2015). Even treatments as simple as a Vitamin A injection and pain medication can be hard to come by (Eban, 2014).
According to the Infectious Diseases Society of America, it is highly probable that in the near future, the U.S. will suffer from a drug shortage of five important injectables to prevent infection, which can have a significant negative impact on the care of our patients and the healthcare system as a whole. The FDA currently has 64 drugs on its Shortage list. To view a current list of drug shortages visit http://rx.trxade.com/drug-shortages/.
The FDA focuses on shortages of medically necessary products since these shortages have the greatest impact on public health. The FDA lists shortages primarily of medically necessary products. Shortages that are expected to be resolved quickly or which involve only a particular strength or package size, are not usually listed on FDA’s Drug Shortage list.
TRxADE Helps Acquire Drugs in Short Supply
Ketorolac Tromethamine is an example of an important anti-inflammatory medication that is in short supply. TRxADE currently has 6 suppliers representing 3 different manufacturers of Ketorolac Tromethamine on its online comparison shopping platform. TRxADE is a great resource to search multiple suppliers, price compare, and acquire drugs in short supply and high demand.
Causes of U.S. Drug Shortages
There are multiple factors that contribute to drug shortages, both due to a lower supply and a higher therapeutic demand. Some of the specific factors are quality requirements, internal or external price referencing, manufacturing process requirements, and even noncompliance (Weerdt, Simoens, Hombrockx, Casteels, & Huys, 2015). Knowing the exact cause of a shortage in drug supply can be difficult to determine “because manufacturers have no legal obligation to transparency” (Valquette & Laupland, 2015).
The FDA states the top reported reason a drug shortage occurs is due to quality/manufacturing issues. On their website they explain “However there have been other reasons such as production delays at the manufacturer and delays companies have experienced receiving raw materials and components from suppliers. Discontinuations are another factor contributing to shortages. FDA can’t require a firm to keep making a drug it wants to discontinue. Sometimes these older drugs are discontinued by companies in favor of newer, more profitable drugs.
With fewer firms making older sterile injectable drugs, there are a limited number of production lines that can make these drugs. The raw material suppliers the firms use are also limited in the amount they can make due to capacity issues at their facilities. This small number of manufacturers and limited production capacity for older sterile injectables, combined with the long lead times and complexity of the manufacturing process for injectable drugs, results in these drugs being vulnerable to shortage. When one company has a problem or discontinues, it is difficult for the remaining firms to increase production quickly and a shortage occurs.”
References:
Eban, K. (2014, June). Drug shortages: the scary reality of a world without meds. Reader’s Digest.
Loftus, P. (2015, May). U.S. drug shortages frustrate doctors, patients. The Wall Street Journal.
Valquette, L., & Laupland, K. (2015). Antimicrobial shortages: another hurdle for clinicians. The Canadian Journal of Infectious Diseases & Medical Microbiology, 26 (2), 67-68. Retrieved from: search.proquest.com
Weerdt, E., Simoens, S., Hombroeckx, L. Casteels, M., & Huys, I. (2015, March). Causes of drug shortages in the legal pharmaceutical framework. Science Direct-Regulatory Toxicology and Pharmacology, 71 (2), 251-258. doi:10.1016/j.yrtph.2015.01.005.
TRxADE Health, Inc. Reports Increase in 2015 First Quarter Financial and Operational Results
TAMPA, FL / ACCESSWIRE / May 6, 2015 / TRxADE Health, Inc., (OTCQB: TRXD) a web-based pharmaceutical marketplace engaged in promoting and enabling trade among independent pharmacies and large pharmaceutical suppliers nationally, announced today its financial and operational results for first quarter 2015.
FINANCIAL HIGHLIGHTS FOR THE THREE MONTHS ENDED MARCH 31, 2015.
- Revenue for the three-month period ending March 31, 2015 and 2014 was $696,133 and $244,196, respectfully showing a substantial 185% growth over the same period last year, and an 18% growth over the three-month period ending December 31, 2014 of $591,624.
- Gross profit from the three-month period ending March 31, 2015 and 2014 was $465,670 compared to $97,406, respectfully.
- The net operating loss for the three-month period ending March 31, 2015 and 2014 was $(443,620) and $(921,995), respectfully.
2015 OPERATION HIGHLIGHTS TO DATE
- Launched new look and feel of application in the first quarter of 2015 that complements TRxADE.com’s efforts of delivering information at time of purchase.
- Launched Westminsterrx.com in March 2015 for wholesaler-to-pharmacy trading.
- Opened new warehouse in Mississippi with capabilities to inventory products and improved logistics.
- Appointment of Mr. Fernando Sanchez as a Board Member, he comes to TRxADE with CFO experience with public companies.
MANAGEMENT COMMENTARY
Mr. Suren Ajjarapu, CEO, stated, “The first quarter financial results continued to reflect 24% growth quarter over quarter for our supplier to pharmacy trade (S2P), and growth continues for our pharmacy to pharmacy trade (P2P). We continue to add 200-225 new validated pharmacies per month. As expressed by the company in the past, we continue to focus our energies on our disruptive technology and data analytics for supply and distribution problems for independent pharmacies, which represents a vast market opportunity to TRxADE S2P trade much larger and more dependable.”
“We continue to develop new modules and expect to add more verticals and customers in coming quarters. We recently announced usage of our bulk upload applications in North America. We believe that, this application could become a substantial revenue driver not only for pharmacies, but TRxADE as well.”
“The first quarter results are exciting, but we believe they are a minor reflection of the opportunities we have in front of us. We have consistently been adding more customers monthly that have begun testing our trading platform. Over the past couple of years, more than 3300 customers have tested our applications, and we see a growing number of third and fifth-time buyers which is a good indicator for growth and market acceptance. The company continues to see expansion of revenue opportunities from S2P trade.”
About TRxADE Health, Inc.
Headquartered in Tampa, Florida, TRxADE Health, Inc. is a web based market platform that enables trade among healthcare buyers and sellers of pharmaceuticals, accessories and services. Please visit us at https://trxadehealth.com/.
Forward-Looking Statements
The information contained herein includes forward-looking statements. These statements relate to future events or to our future financial performance, and involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements.
You should not place undue reliance on forward-looking statements since they involve known and unknown risks, uncertainties and other factors which are, in some cases, beyond our control and which could, and likely will, materially affect actual results, levels of activity, performance or achievements.
Any forward-looking statement reflects our current views with respect to future events and is subject to these and other risks, uncertainties and assumptions relating to our operations, results of operations, growth strategy and liquidity. Except as may be required by applicable law, we assume no obligation to publicly update or revise these forward-looking statements for any reason, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future.
Media Contact:
Carol Lucas
(800) 261-0281
[email protected]
Investor and Analyst Contact:
Howard Doss
(941) 228-0162
[email protected]
Investor Relations:
Capital Group Communications
Mark Bernhard
(415) 332-7200 Ext. 222
[email protected]
SOURCE: TRxADE Health, Inc.
