While many pharmacists across the United States struggle to get Ozempic, some aren't bothered by it.
Nate Hux, owner of Pickerington Pharmacy in Ohio, last summer stopped stocking the diabetes drug — which has soared in popularity, not least because of its off-label use as a weight-loss aid.
At the time, there was a widespread shortage of Ozempic, but that wasn't what prompted Hux to ditch the drug. Instead, he said, it was because selling the drug hurt his business.
The average wholesale price pharmacies pay for Ozempic is about $900 for a 30-day supply, he said. But Hux said he typically only reimburses $860 per prescription.
“Our inventory is too expensive,” he said.
Hux is part of a group of independent pharmacists who have stopped carrying Ozempic and others in its class, in part, they say, because pharmacy benefit managers, who act as intermediaries between pharmacists and insurance companies, are underpaid. These drugs, called GLP-1 agonists, are relatively new and patent-pending, which means there are no generic alternatives.
The development adds a twist to the Ozempic saga in the US, where many patients were forced to travel to multiple pharmacies last year to find the drug, which has been difficult to find due to shortages.
Steve Hoffart, owner of Magnolia Pharmacy in Magnolia, Texas, stopped stocking Ozempic and similar diabetes drugs about a year ago. He's seen reimbursements that are $10 to $40 less than the cost of the drug.
The changes, he said, were necessary to keep his pharmacy afloat.
“There's always been a supply issue, but a lot of independents are just telling people we can't get it because we can't afford to distribute stuff below cost,” he said.
Threat to independent pharmacies
Inma Hernandez, an associate professor at the UC San Diego Skagos School of Pharmacy, said underpayment is a big problem for independent pharmacists, who are often reimbursed at lower rates than those with larger bargains. Capabilities of large retail chain drugstores.
“That's why a lot of independent pharmacies are going out of business,” she said, adding that there was nothing pharmacists could do about it.
“These are not contracts we can negotiate,” Hoffat said. “They take it or leave it. You either take the contract or you lose access to patients.”
Allison Schneider, a spokesman for Novo Nordisk, the maker of Ozempic, said the company has no control over the price of the drug paid by individual pharmacies or the amount reimbursed by pharmacy benefit managers. “These details are negotiated between the pharmacy and an external third party,” she said.
According to the Commonwealth Fund, a nonprofit focused on public health issues, the three largest pharmacy benefit managers — CVS Caremark, Cigna's Express Scripts and UnitedHealth Group's OptumRx — command 80% of the market, giving them huge negotiating ability. All three are associated with major health insurance providers.
Andrea Pivarunas, a spokeswoman for the National Association of Community Pharmacists, an independent pharmacy trade group, said pharmacy benefit managers have a particular incentive to underpay pharmacists because it could lead customers to their own business.
Greg Lopes, spokesman for the Pharmacy Care Management Association, which represents pharmacy benefit managers, said, “Independent pharmacists are important partners for pharmacy benefit companies in providing patients with quality care and essential medications at an affordable cost.”
High Cost of Brand-name Drugs
Underpayment isn't just for drugs like Ozempic.
According to Antonio Ciaccia, this is often a problem with brand-name drugs. Ciaccia is CEO of 46brooklyn, a nonprofit that studies drug pricing in the US
The reimbursement rates offered by pharmacy benefit managers are designed to incentivize pharmacists to shop around for the lowest-priced drug, Ciaccia said. This is usually not a problem with generic drugs because it can be found at low cost.
Finding low prices for brand-name drugs is much harder, however, because they are sold by a single manufacturer and are often offered to pharmacists at a fixed price, he said.
If pharmacists can make up the difference by selling cheaper generic drugs with higher reimbursement rates, they may be able to profit by selling brand-name drugs at a loss.
“For many pharmacies, they have no control over this,” Ciaccia said, referring to the demand for generic drugs. “As a result, many pharmacies will consider grossly underpaid medicines and make a commercial decision not to let this medicine impact their entire business.”
About two years ago, Mike Koelzer, a pharmacist and owner of Kay Pharmacy in Grand Rapids, Mich., was forced to make that choice. In an effort to keep his business from going under, he made the difficult decision to stop selling all brand-name drugs.
Doctors still sometimes prescribe Ozempic and other brand-name drugs at his pharmacy, and some customers still come to ask, but Koezler tells them he doesn't have them. He doesn't think his decision not to carry the drug has resulted in a loss of business.
“I think they get it,” he said. “They know people are going to be pushed around by insurance.”
Magnolia Pharmacy's Hoffart acknowledged that his decision not to carry Ozempic and similar drugs may turn off some customers.
“I can no longer give away things just out of goodness and kindness,” Hoffat said. “It's hard for some patients, but at some point we can't take care of any patients if we're not in business.”
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