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Predatory Practices - Survey Says Middlemen Destroying Delaware's Independent Pharmacies

Report Details

Report Description: 
What Was Performed? A special report was performed as a follow-up to a recent survey provided by the State Auditor’s Office to independent pharmacy owners on pharmacy benefit manager (PBM) operations. Why This Engagement? Under the Delaware Code, it is the State Auditor’s job to offer suggestions to improve efficiency and effectiveness in state government. This special report reviews the main concerns of small independent pharmacy owners on how PBM operations affect their businesses. This special report is intended to help lawmakers review and improve laws that regulate PBM behavior. What Was Found? Survey results revealed the pressures being placed on Delaware’s independent pharmacies to close shop and place Delawareans’ healthcare in the hands of large retail establishments. The report highlights a series of takeaways, including: 1. Direct and Indirect Remuneration (DIR) fees, decreasing reimbursements, and a lack of state-regulated transparency and accountability have a very high impact on Delaware’s independent pharmacies. 2. Delaware’s independent pharmacists report being squeezed by pharmacy benefit managers by means of being forced to accept lower reimbursements, exclusionary formularies, and preferred pharmacies. 3. Owners of Delaware’s independent pharmacies unanimously felt that PBMs were an obstacle between the patient and the healthcare provider and that they were largely responsible for increasing drug prices. 4. Delaware’s independent pharmacies suffer from similar problems noted in the 2019 National Community Pharmacists Association (NCPA) survey, which observed that greater oversight is needed. The new special report, “Predatory Practices: Survey Says Middlemen Destroying Delaware’s Independent Pharmacies,” can be found on our website.
Date Issued: 
Friday, August 27, 2021
Agency Reviewed / Investigated: 
United States
Type of Report: 
Professional Standard: 
GAO's Yellow Book, Generally Accepted Government Auditing Standards (GAGAS)

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