Oregon Preferred Drug List Excludes Some ‘Big Names,’ USA Today Reports
In an attempt to control the "soar[ing]" cost of Medicaid, Oregon's preferred drug list -- developed by the state to dictate which drugs should be covered under Medicaid in an effort to control costs -- does not include some of the "most popular drugs" in the United States because officials do not believe they are more effective than cheaper alternatives, USA Today reports. To cut costs, "cash-strapped" Medicaid programs across the United States have turned to formularies, which are "usually drawn up behind closed doors" and can be based on which drug company "offers the best deal." However, Oregon's preferred drug list differs from other Medicaid formularies because the debates over which drugs should be on the list were held in public, and doctors can prescribe drugs excluded from the list without first getting permission. In addition, state officials hired independent researchers to review medical studies on drug effectiveness, "essentially requir[ing] drug makers to prove that the latest and most expensive drugs are really better products than older, less-advertised products," according to USA Today. Researchers reported negligible differences among drugs that treat conditions such as heartburn, pain and high cholesterol, so only the lowest-cost options were approved by the state. Oregon officials said that in the last two months the state has seen a move toward the use of drugs on the formulary, and they estimate that Medicaid will save up to $17 million in the list's first year. "It's about looking at pharmaceuticals like any other purchase -- a truck or a computer or a house," Kurt Furst, an adviser to the state government, said.
The Pharmaceutical Research and Manufacturers of America contends that formularies are illegal because they could restrict Medicaid beneficiaries to a list of "lower cost, less-effective" drugs. Last month, PhRMA filed a lawsuit against a preferred drug list in Michigan. However, PhRMA will need different legal tactics to fight Oregon's program because doctors can prescribe any drug without seeking prior approval, USA Today reports. Purdue Pharma has filed a suit against Oregon claiming legislators meant for the formulary to include "the most effective" drug in a particular class, and "insufficient evidence" does not determine which drug is most effective. "A lack of evidence of relative clinical effectiveness is not the same thing at all as a determination that they're all the same," PhRMA lobbyist Jim Gardner said (Appleby, USA Today, 10/10).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.