Understanding the Pharmaceutical Distribution and Payment System

By August 17, 2009November 2nd, 2009Commentary

The United States has a very complex system for physically getting drugs from the manufacturing plant to the patient, due to the great variety of pharmaceuticals, their routes of administration and care sites.  The payment flows can be even more complex, with PBMs, buying groups, rebates, government regulations, etc.  The recent litigation over AWP pricing methods has created further confusion.  The Academy of Managed Care Pharmacy has released a new version of a report outlining both the physical and payment flows.   (AMCP Report)  This report is an invaluable aid for understanding the system.  It also leaves one with the sense that the complexity has probably created opportunities for less efficient pricing than might otherwise exist.

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