CVS Health yesterday announced major changes to how it will price its prescription drugs—a move observers say could increase transparency in the industry. The announcement comes amid growing government scrutiny of the current mazelike US drug-pricing system, which results in the world's highest per capita out-of-pocket spending on prescription drugs (see data). Under the CostVantage plan set to take effect in early 2024, pharmacies will be reimbursed the drug manufacturer's list price in addition to a standard markup and a dispensing fee. For decades, drug prices have been determined by an opaque, complex proprietary process generally overseen by pharmacy benefit managers, an intermediary historically tasked with finding the lowest cost for consumers (see history). CVS expects the move to reduce drug prices in many cases while acknowledging the price of some drugs could increase. The news follows the Biden administration's announcement of price caps on 10 prescription drugs in August designed to offset costs to consumers.
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