PSM Advisory Board approves policy resolution on reimbursement practices and supply chain safety

The PSM Governing and Advisory Boards has approved the following resolution:

When pharmacies buy and dispense medicine for patients, if they are reimbursed below the cost of acquisition of medicines, they are put in a difficult situation. They need to buy medicine, but at prices that no legitimate seller can support. They look for more obscure and lesser known sellers.

In recent years we have seen criminals take advantage of this market dynamic and go into business selling counterfeit and diverted medicine into the legitimate supply chain to pharmacies hunting for bargains. These criminals pose as legitimate distributors, sometimes even acquiring state-issued distributor or pharmacy licenses, to add a veneer of credibility to their sales.  Recent prosecutions of criminals using this technique show that it is wildly lucrative and endangers some of the most vulnerable patient communities. [See the cases of Lazaro Hernandez, Armando Herrera, and Boris Aminov]

PSM opposes the practice of reimbursing pharmacies below the cost of acquisition of medicine and supports efforts to reform reimbursement systems that eliminate this market dynamic that threatens the safety of our drug supply.