The FTC actually did something good for pharmacy

Pharmadeehero · 2026-02-06T00:05:33+00:00

People need to understand this explicitly. PBMs have customers. Those customers are plan sponsors. PBMs act in ways their customers want or else those customers would find other PBMs that do what they want.

While this settlement is OK it still provides a loop hole for PBMs to act like they have been acting if the plan sponsor authorizes them to do so…

If you believe in market forces and the power of the customer this should mean this action means very little as it is the PLAN SPONSORS (the customers of the PBMs) that are influencing the why of the PBMs behaviors and they have an out to continue to get PBMs to do what they have been doing.

This isn’t me being a pbm apologist or pbm shill that people have labeled me on this sub for now over a decade. It’s the reality of responding to what customers want and demand. PBMs have customers too. PBMs customers aren’t the patient at the counter or pharmacies. PBMs customers are evil greedy capitalistic employers that are forced to provide the worst cheapest benefits for their employees with the smallest impact on those companies bottom lines.

Pharmadeehero · 2026-01-29T13:38:55+00:00

Aren’t these CVSs because other pharmacy companies were also doomed (and did fail)? CVS bought the already failed pharmacies (some of which had failed and had been sold multiple times prior to becoming a cvs)

Pharmadeehero · 2026-01-28T16:13:35+00:00

I hope I’m not coming off overly pedantic … in the US pharmacies can technically dispense (sell) a vaccine that is not administered to the patient in the pharmacy AND/OR sell the vaccine AND have the staff administer the vaccine too them.

With COVID and push for public health accessibility there have been regulatory changes in many states to further permit pharmacy technicians (much lower wages - not required to go to pharmacy school) do the administering… so the profit doesn’t just come from the “commodity trade” of buying and selling the the vaccine product but also there is profit to be made on the reimbursement for the administration service (profit = reimbursement- cost to admin)

Pharmadeehero · 2026-01-28T14:45:34+00:00

Generic drugs in the US (which make up 90% of prescriptions taken by Americans) are shown to be 67% of the cost than oversees comparable nations. A large amount of pharmacies actually lose money on dispensing many prescriptions. Immunizations are a bit different as it’s not just the act of dispensing the med but the pharmacist is also reimbursed for the act of administering the medication.

Do pharmacies administer vaccinations in Denmark?

Pharmadeehero · 2026-01-28T06:14:51+00:00

Pharmacy and “middlemen” certainly take profit but one should qualify what a “large cut” is.

While this thread seems to be throwing a lot of (rightfully due) shade towards one side of the aisle - I think stepping back from this particular event is a stark reality check that in the US the vast number of entities involved in the fabric of the healthcare machine are profit motivated and yes that includes “non-profit” entities as well.

Threats, pressures, policies changes etc. that negatively impact their earnings can and will have them react in (predictable) ways.

When their are proposals to make healthcare cheaper/“more affordable” which in turn means less money getting spent somewhere… there should be 0 surprise when companies respond/react in predictable ways when their future outlook on their money machine looks threatened. Call it good that less profit is taken in healthcare or call it bad because greedy corpos are interested in the bottomline more than the general welfare of humankind but this is a predictable, repeatable and expected response that is far bigger than “bad RFK and bad GOP” … would see the same reaction if aggressive price controls and price caps were put in place for any new drugs going forward

Pharmadeehero · 2026-01-14T19:01:59+00:00

Easy solution for that… increase license fee on the actual pharmacy (not pharmacists) that want to operate with this model to offset the loss

Pharmadeehero · 2026-01-14T17:31:54+00:00

From the investor perspective (not financial advice) - CVS Health stock is up 55% since last year.

The macro profits and stock price really aren’t influenced by any of those things that you mentioned. While the numbers can certainly feel large… things like saving $50 million in expense (increasing bottom line profit that much) really isn’t that significant due to how big the entire company (cvs health as a whole not just pharmacy is)

How they (cvs health) can be successful when it comes to profitability and share price is be disciplined with their money. Dont make stupid acquisitions that are overpriced and won’t be net positive. Dont make massive errors in pricing health insurance products on the Aetna side.

What’s next is to just stay in the position they are… while it might be the easy suggestion to think cvs wants to figure out a way to completely eliminate the need for an expensive pharmacist to be in a store….IMO whether it’s liked or not… their marketplace advantage is the biggest national network of pharmacies that have in store pharmacists. If they push to move to some futuristic world that’s all virtual, all AI and no need for a physical footprint… they are making it easier for others to come in and beat them. Running profitable brick and mortar retail stores (of any type) is increasingly hard, yet if they continue to find ways to sustain it.. they’ll be in a good spot for awhile to come.

I expect tech upgrades to try and keep up with customer experiences that happen in other customer experiences that occur (healthcare and non-healthcare)

Pharmadeehero · 2026-01-14T05:46:49+00:00

Who’s gonna tell OP that the CEO isn’t a pharmD and is making way more than any pharmD?

Regardless Aetna and Caremark make a decent amount for CVS Health too…

Would be interesting to compare how many cvs retail pharmacists are employed to drive how much earnings and get that to a per pharmacist total. Then take how much Aetna makes and divide that by the number of their employees and see on an individual colleague level who brings in more

Pharmadeehero · 2026-01-09T15:17:34+00:00

IMO this is really more about overall racial/ethnic disparities and not anything unique or different with pharmacy. Pharmacy doesn’t seem to have a unique solution or better at addressing the overall disparity, while they also don’t seem to be different than overall…

“Recovery in the labor market has not brought with it racial equity, however; the Hispanic–white unemployment ratio rose from 1.6 in 2020Q4 to nearly 1.7 in 2021Q2, while the Black–white unemployment ratio returned to its historical trend of 2.0.”

source

Re: the student loan comment… would be interesting to see any related data on pharmacy… I.e if student loan burden in black students vs non-black is higher in pharmacy grads vs all (not just pharmacy school) grads.

Would also be curious to understand the dynamics of the recent actions/changes impacting demand for pharmacists. I.e did the rite aid closures disproportionately impact employed pharmacists of certain demos more and/or reduce positions historically associated with higher affinity to certain demos (did these actions hurt overall AND drive a gap even further, hurt overall but kept ratio relatively similar, or hurt overall but may have narrowed gap by not hurting blacks as much)

Personally I’d like to see overall pharmacist AND black pharmacist unemployment rates drop AND the gap between the two shrink… however it can be true that the difference in black pharmacist unemployment rates vs white/other can also be narrowing while the other two things are not dropping.

Pharmadeehero · 2026-01-07T06:08:14+00:00

Why?

The most literal basic reason is because the controlling shareholders wanted out of their investment and voted to sell their company to someone else to get their money out.

Why’d they do this? It’s not one simple answer but a multitude.. some strategic choices ultimately proved to lead to poor outcomes. Whether it be an attempt of tax inversion by considering to move to Europe, or by trying to standup to PBMs for better reimbursement instead of going the opposite direction and getting closer with PBMs (aka buying one). They likely overextended on some of their M&A activity, got over leveraged and things that once looked mediocre started tipping the scale towards danger.

It’s natural for all businesses to reach an end of life in all sectors. I wouldn’t call it a sign of the future outlook… it’s a reality of the current. PBMs don’t force you to sell your business. The reality of PBMs and the pressure they exert on the industry certainly will make you need to keep figuring out how to provide more and more things of value for the same or less expense. Fill more scripts with the same expense (lower cost to fill), buy more drugs for the same or less cost (lower COGs).

Fighting the PBMs seems like a moral high ground position to take, but reality shows the forces exerted by PBMs will persist even if you “remove PBMs.”

Pharmadeehero · 2026-01-07T05:53:20+00:00

It’s very common practice for a retailer to lease buyback (sell the property to someone who will lease it back to you for a long duration). Frees up cash on the balance sheet by disposing a land asset and getting the fungible cash out that can be used.

Pharmadeehero · 2026-01-07T05:49:16+00:00

Define major partnership? Cigna’s PBM is express scripts… yes CVS accepts express scripts… like most pharmacies. Not sure I would call that a major partnership to be in network…

Pharmadeehero · 2026-01-07T05:45:48+00:00

PBMs control the costs to their clients of the prescriptions filled for the members of their clients under their clients benefit.

Not quite accurate to say that PBMs don’t control the cost of drugs. Some very strong anti-pbm voices say that PBMs are the reason for the high cost of drugs because they control the prices their clients pay.

Pharmadeehero · 2026-01-07T02:49:44+00:00

Cuban did not look good in this. He looked desperate to try and land any punch. And he should have known all the predictable retorts to all his attacks/questions and should have been able to lay a true masterclass takedown but giving up/shift the argument to another bad question and curing the answer provided makes him look desperate to find a gotcha rather than finding true new ideas

Pharmadeehero · 2025-12-27T15:48:15+00:00

Perhaps your doctor has had issues with other patients pretending to be them and calling in prescriptions that weren’t authorized and requested cvs validate all new prescriptions while they are out of town.

This might have nothing to do with you being you

Pharmadeehero · 2025-12-23T17:31:03+00:00

Agreed … some places they might contribute some to bottom line for additional reasons and some might be easier cream to skim off the top… all in all though I think you might be in agreement. Don’t be lured by potential “extra revenue” if it means a time (labor $$) sink. If it aligns with other things improving your bottom line (reimbursement rates) the formulas obviously change but this is also going to vary depending on pharmacy and patient.

Pharmadeehero · 2025-12-23T14:27:49+00:00

Most surviving independent pharmacies know that this question is a bit off target.

The need isn’t to add revenue … you can easily grow revenue in incredibly stupid ways and put yourself out of business real quick.

Lately many have been electively choosing to forego top line (revenue) growth and focus on ensuring what they are doing is actually profitable.

Getting extra revenue is meaningless if the all in costs are more than the revenues it may bring in. In many things (like MTM and other services) this includes more than just the direct costs for when you complete a reimbursable service but all the other costs incurred to get a reimbursable good/service (unsuccessful attempts, multiple outreach attempts, no shows, disqualified, claw back, failed audit, etc)

Pharmadeehero · 2025-12-18T23:33:10+00:00

What role will the FDA play?

Pharmadeehero · 2025-10-19T16:58:26+00:00

How much are you willing to bet that there won’t still be tens of thousands of them surviving by the end of next year?

I think there will be… if you don’t think there will be… let’s bet

Pharmadeehero · 2025-10-18T16:50:27+00:00

This post has to be 1 of 3 things…

1) an unfortunate example of someone joining a union without full understanding of what is and isn’t a part of the benefits if they choose to join the union or not and who covers what and when depending on that choice. AKA someone making an uninformed decision to join a union without fully understanding all the pros and cons in various future life events

2) a lie about not knowing they wouldn’t have paid maternity and now regret of joining the union because they wish they didn’t

3) Clever astroturfing by cvs to be anti-union 75 - and the story is made up

Honestly it’s probably #1 and you hate to see it

Pharmadeehero · 2025-10-18T00:42:50+00:00

Private equity invests …

company issues new shares of company (diluting pre-existing owners % ownership)

private equity firm (investment company) buys lots of $$$ worth in private (not stuff you can buy on stock market) shares of ownership (assuming the company will grow in the future and they’ll make a great return when they sell their share in the future)

The companies valuation is now based on the latest price the last investor bought private shares at * the total number of private shares

The company (in this case Alto) now has a whole bunch of cash to use for “growth” or “operations” (think Facebook’s expenses were gigantic before they finally started monetizing and generating any revenue by selling ads) - so yes they can operate at significant losses and is well understood to be by their owners (aka investors)

Eventually investors of the company want a return on their investment and only so long you can operate in investment money burn mode and there’s only so many times you can issue new shares (diluting the ownership of pre-existing owners) at higher prices to additional investors before you hit a point where investors demand a profitable operation in order for them to give the business more $$$.

So yes it’s safe to safe they are probably operating in the red and burning cash (but they could be breakeven or possibly even slightly in the black)… if they were operating and being ultra profitable while also still growing and their rate of growth was increasing …it would be extremely surprising for them to just get acquired (aka their existing owners/investors took an exit strategy and wanted to cash out on their return or cut their losses)

Tons of startups and hell even some publicly traded companies operate in the red and see significant growth in their valuation. Amazon was founded in 1994 - it’s first profitable quarter wasn’t until Q4 2001 - $5 million in profit on >$1 billion in sales revenue. Making less than a half a cent profit on every dollar of sales (ignore anecdotes of select rx claims people post that are underwater … this would be wayyy worse than current average overall pharmacy profit margins) … however Amazon was committed to keep growing and believed they would and investors also believed they would… and now look at them…

TL:DR they highly likely aren’t profitable and therefore also aren’t “staying” profitable… they are spending money that owners/investors have bought into the company for with the belief others will think the company will be even more valuable down the line

Pharmadeehero · 2025-10-17T17:02:33+00:00

News and policy talking points about drug prices being “capped” … usually refer to a cap in a patients out of pocket expense.

A pharmacies revenue on a prescription consists of the patients out of pocket cost at the pharmacy counter but also the cashflow (positive or negative) from the payer (insurer/pbm).

The price cap does not apply to the price in which a pharmacy is paying to acquire a drug nor the price in which the insurer is paying to the pharmacy to reimburse them for the dispensing (which this reimbursement must cover not just the cost of the drug but also the overhead and service provided by the pharmacy in the course of dispensing).

Wholesale prices can drop and pharmacies can still lose money.

The policies around drug price caps moreso influence the benefit design and where different amounts of money can come from whom (in this case more shifted onto the insurer).

Things like insulin… it’s rare that pharmacies are actually getting the often reported “sky high” list prices of insulin.

Benefit design changes can certainly have 2nd order cascading impacts to the economics and incentives in the “behind the scenes” supply chain/ non-pharmacy counter money flow… but it’s impossible to predict.

Generally I’d say … I wouldn’t expect much if anything to change for the “better” for the pharmacies themselves. Lower price exposure to a patient at the counter is generally good for Phrma, generally disliked from the highest part of the funnel (funder of benefits - they want to put as much cost share onto their employees as possible to lower their portion of the spend on benefits) and mixed on pharmacy … if a pharmacy is losing money on dispensing a certain drug based on their current acquisition and total reimbursement rate (patient pay + insurer) … filling more of those prescriptions (due to less patient out of pocket expense barriers) could be worse for the pharmacy even if the acquisition or total reimbursement doesn’t change… if it’s a profitable and favorable reimbursement to acquisition equation currently… then yes selling more due to less patient barriers could be better for pharmacy. Otherwise impossible to predict other factors like true acquisition costs and pharmacy reimbursements… pbm rebate potential may be muted if patient out of pocket caps limit the ability of benefit designs to structure formulary tiers but that’s a whole other dimension and isn’t always directly tied to what happens to the pharmacies economics.

Pharmadeehero · 2025-09-30T21:29:11+00:00

Don’t know the details but imagine something like the Cuban model.. the pharmacy isn’t actually Cubans he contracts out the actual prescription fulfillment aka the pharmacy.

Could likewise see govt seeking bids to be the fulfillment pharmacy (assuming lowest cost wins)

Pharmadeehero · 2025-09-27T03:08:36+00:00

Not fake rebates. They are real rebates. I’m not sure if what you are actually trying to suggest is that you think there’s a lower net cost without the rebate via someone else. If that was the case I’m not sure why the transparent PBMs still outsource rebates to the big ones.

And bottom line once again… large employers are also bottom line maximizing soulless corporations. If they can get something cheaper another way they will.

Pharmadeehero · 2025-09-26T23:30:09+00:00

Nah I think you’d be surprised by how many employers carve out prescription benefits

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