Startups aim to make pharmacy benefit managers 'transparent' to cut drug costs

In an effort to make prescription drugs more affordable for Americans, startups have emerged with the aim of making the pharmacy benefit manager (PBM) model more transparent and therefore reducing drug costs for patients and insurers. As drug prices continue to be a concern for many Americans, governments and private companies are trying to find ways to make medications more accessible and affordable.

One such company is Truepill, a full-service digital pharmacy that manages everything from prescription filling to delivery. Truepill is working to make the drug supply chain more transparent and affordable by passing discounts directly to patients and insurers, instead of going through intermediaries like PBMs. The company's co-founder and CEO, Rahim Khan, said that Truepill works with pharmaceutical manufacturers to get discounts on drugs directly, rather than going through the middlemen that PBMs represent. By cutting out the intermediaries, Truepill can deliver drugs to patients at a fraction of the cost of traditional pharmacies, and at no cost to the patient.

Another company taking on the PBM model is ScriptCo, a technology-focused pharmacy that offers direct-to-patient pricing and delivers medications for free. ScriptCo was founded on the belief that everyone should have access to affordable medications. They achieve this by directly passing drug manufacturer discounts on to patients, and by accepting insurance to cover the cost of medications.

Both Truepill and ScriptCo are challenging the traditional PBM business model, which has been criticized for its lack of transparency and potential for driving up drug costs for both patients and insurers. These startups are working to make the drug pricing model more transparent, and therefore affordable, for Americans. By cutting out the middlemen and working directly with drug manufacturers and insurance companies, these startups are helping to reduce the cost of medications for patients and insurers alike.

However, there are those who argue that such actions only serve to mask the root problem, which is the high list prices set by drug manufacturers themselves. Drug companies capture about two-thirds of the revenue in the pharmaceutical industry, with PBMs accounting for only a small slice. Therefore, fixing the problem of high drug costs requires getting to the root of the problem, which is the high list prices set by drug manufacturers.

Overall, the high cost of prescription drugs is a major problem in the United States, with drug prices in the country being 2.5 times higher than in other similar high-income nations. With the government now negotiating prices on some high-cost drugs, it remains to be seen what effect this will have on drug costs for Americans.

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