Pharmacy Industry News: No takers for 10K seats in engg, pharma colleges | Pharmacy Industry News

Pharmacy Industry News: No takers for 10K seats in engg, pharma colleges

No takers for 10K seats in engg, pharma colleges

At least 25% of seats in engineering and pharmacy colleges have remained vacant after the first round of admissions here on Saturday.

Of the 43,000 engineering and pharmacy seats a whopping 10,200 seats have been left vacant after registration reporting of the first round of admissions granted by the Admission Committee for Professional Courses (ACPC) was completed on Saturday.

A total of 43,007 students had registered online seeking admission to engineering and pharmacy courses and were granted admission after the three mock rounds. After this, the students had to reporting for registration confirming their admission.

Consumer Reports: Labels on medicine can lack key facts

It’s comparable to driving a car without a seat belt — a new investigation from Consumer Reports Health finds that drug labels sometimes lack key safety warnings, and some pharmacies fail to include the medication guides required by the federal government.

For its investigative “spot check,” Consumer Reports Health sent staffers to five individual drugstores in Yonkers, N.Y. — Costco, CVS, Target, Walgreens, and Walmart — to fill prescriptions for warfarin. Warfarin (Coumadin and generics), a blood thinner used to prevent strokes, is one of the 20 most commonly prescribed drugs in the United States, according to IMS Health.

Most alarmingly, four of the five pharmacies failed to provide a federally mandated medication guide that is required for certain drugs, including warfarin. And while all of the pharmacies provided their own patient materials, known as consumer medication information (CMI), they differed from the FDA-approved guide for warfarin and contained conflicting warnings about alcohol. Warfarin can cause severe internal bleeding that can be life-threatening. It is the second most common drug implicated in emergency room visits in the United States.

Consumer Reports Health also wanted to see how drug labels, warning stickers and consumer drug information sheets varied among pharmacies. While the findings are not nationally representative for each chain, they raise significant concern.

Part of the problem, according to Lisa Gill, prescription drug editor, Consumer Reports Health, is that there’s no nationwide standard like “Nutrition Facts” on food packages or the “Drug Facts” on over-the-counter medication. While the U.S. Food and Drug Administration (FDA) requires certain details on labels such as a patient’s name and dosage instructions, it does not monitor drug labels; rather, each state’s board of pharmacy is responsible for their overall content. And whether there are warnings on the bottles is left to the individual pharmacist.

Merger would build PBM powerhouse

Express Scripts Inc.’s plan to buy its largest competitor, Medco Health Solutions Inc., for $29.1 billion would result in a seismic shift in the pharmacy benefits management marketplace.

The deal, jointly announced by the companies last week, would see Express Scripts pay $71.36 per share for its Franklin Lakes, N.J.-based rival, 28% more than Medco’s closing stock price the day before the deal was announced.

If and when the sale is finalized, the combined company would be the largest player in the pharmacy benefits management industry, representing roughly 34% of the U.S. market and an estimated 1.6 billion prescriptions administered or dispensed in 2013, according to JMP Securities L.L.C. Its closest competitor, Woonsocket, R.I.-based CVS Caremark Corp., would have 20% of the market and an estimated 937 million prescriptions dispensed in 2013, according to the San Francisco-based firm.

“It certainly gives (Express Scripts) additional clout,” said Constantine Davides, a Boston-based senior analyst at JMP Securities. “With the type of market share generated here, they’re going to have significantly increased leverage against pharmaceutical manufacturers and the retailers in their network.”

News of the proposed deal was accompanied by Medco’s announcement that it would lose its contract with UnitedHealth Group Inc. in 2013, an $11 billion account comprising about 17% of its business.
Pros and cons

While the proposed deal is likely to be opposed by industry groups representing pharmaceutical manufacturers and retailers, analysts said the merged company’s clients could benefit from its ability to apply pressure on supply partners and its expanded offering of products and services.

“More likely than not, I would think that employers are going to be better off if the companies are together, to the extent that their ability to squeeze their suppliers will more than make up for any higher margins that they earn,” said Matthew Coffina, an equity analyst at Chicago-based Morningstar Inc.

Combining the companies would join very different philosophies on the administration of pharmacy benefits. Express Scripts’ application of behavioral sciences in driving consumers toward diligent and more cost-effective prescription treatment—particularly generic medications and mail-order distribution—is a concept that would be relatively foreign for Medco clients, he said. Cost savings to be realized in improving generic penetration rates, mail order usage and prescription adherence “is certainly something for current Medco customers to be excited about,” Mr. Coffina said.

At the same time, Medco’s focus on clinical, therapeutic and pharmacogenomic research as well as its specialized pharmacists could provide employers enrolled with Express Scripts with ways to improve prescription adherence and reduce the frequency of adverse reactions from conflicting medications.

“Most likely, the combination of their expertise will create a much stronger offering and would certainly be one of the market share gains if the deal goes through,” Mr. Coffina said.
Antitrust considerations

Whether the deal will be completed is at best uncertain, as analysts expressed concern about potential antitrust challenges from the Federal Trade Commission, which must approve the sale.

The companies likely would argue that the increased bargaining leverage over health care providers, pharmaceutical manufacturers and retailers would result in lower prescription costs for employers, experts said. However, the sale also could result in the merged company gaining increased bargaining power over its customers.

“The antitrust issue is the key risk to the deal,” JMP Securities’ Mr. Davides said. “Express Scripts is going to have to prove that the deal is pro-consumer.”

In its note to investors regarding the sale announcement, Morningstar said its analysts were “floored” by news of the proposed transaction. The note went on to characterize the deal as having a “less than 50% chance” of meeting the approval of the FTC.

“No one thought this deal could get past regulators,” said Mr. Coffina. “It’s surprising that they’re even trying the deal, and it would be equally surprising if they actually get it done.”

An unfavorable evaluation by the FTC could be a problem for some employers enrolled with either company, said Jeffery Gruen, Washington-based head of health care services at PRTM Management Consultants Inc. The FTC could force the companies to shed some accounts as a condition of approving the deal.

“Some of those clients might see some disruption and would need to get associated with a different PBM,” Mr. Gruen said. “But that’s going to be a small minority, if any.”

Employer clients might benefit from the companies’ merger if it passes regulatory review, but some industry observers said the deal—especially given its size and market share—could be a harbinger of more consolidation in the PBM market, which they said could be detrimental for employers in the long run.

“The longer-term risk is that this aggregation forces other PBMs to aggregate as well in order to compete,” said Brenda Motheral, executive director of the Plano, Texas-based Pharmacy Benefits Management Institute. “Over time, employers really do have meaningfully fewer PBMs to choose from.”

Laurel Pickering, executive director of the New York-based Northeast Business Group on Health, said a merger like that proposed by Express Scripts and Medco would decrease “competition in the PBM market, which usually isn’t good for employers looking to get the most value from their PBM.”

“Anytime you decrease competition in the market, it reduces the incentives companies have to provide better prices,” Ms. Pickering said.

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