Drug Coupons Impact Study

Prescription Drug Coupons

“Couponing is not some underhanded technique.” -Bob Ehrlich

An interesting study on drug coupons was released in The New England Journal of Medicine on 8/28. These coupons are used for brand name drugs to help subsidize cost for consumers. These coupons usually are for a limited period of a few months to a year. The study authors wanted to determine what drugs were doing these and whether cheaper drug alternatives existed for couponed drugs.

The authors, Drs. Ross and Kesselheim, found that over 60% of couponed drugs had a therapeutic or generic alternative. They found 38% had no equivalent, as these were drugs still on patent. The authors raise several concerns about coupons. They say that coupons encourage use of more expensive drugs; and once patients lose the subsidy from drug companies, overall cost to insurers and patients go up. They also are concerned that physicians do not counsel patients that coupons are temporary and the patient will have to pay more eventually through higher co-pays.

The authors clearly do not favor use of coupons. While the data are interesting, the authors have proved the obvious. Drug companies want to remove a cost barrier to trying a new drug. Coupons are almost always used by branded products to gain trial or reuse. Consumers know that a coupon is a time limited discount and eventually they will need to pay full price if they continue to buy the item. The idea that naïve consumers are somehow mislead is wrong.

I have no issue with their desire for better physician awareness of price of branded drugs and the cheaper alternatives. Physicians need to be better prepared to answer patient questions on drug costs and how a coupon is a temporary support.

Couponing is not some underhanded technique drug companies use to fool consumers. It is just marketing. Americans are smart consumers. Those who use coupons in their trial period need to make a decision if the drug is worth the non-subsidized price. While insurance companies probably prefer no one be allowed to have drug coupons, the use of these promotional devices is legal. Insurance companies do not like DTC of any type because it may not be in line with their chosen formulary. They do not want consumers asking for a drug they prefer not to offer.

We all like to take advantage of coupons and other price off deals for many categories of consumer products. Many of us like those products and eventually pay more than during our trial period. The authors, like many providers and payers, appear to dislike branded drug marketing. Their concerns about inappropriate use and rising cost are legitimate. In a free market, however, we allow consumers to decide what is worth the premium cost. That is why we do not all drive a Hyundai, and buy our fashions at Target. I know drugs are different, but the added value of branded drugs is a decision made by doctor and patient. Coupons may be part of that decision and as long as patients know the duration of the discount, they are entitled to make their own decisions.

Bob Ehrlich, Chairman

DTC Perspectives, Inc.

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