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Explaining complex world of pharmacy benefit managers led to series for this data journalist Date: 05/29/18


Katie Wedell

By Katie Wedell

Even though prescription drug prices had become a hot topic by late 2016 with public outrage aimed at Mylan and other drug makers for price hikes, telling the complicated story of the industry forces that control those prices was a hard sell to my editors at the Dayton Daily News. How do you convince someone a story is necessary when they don’t understand the first thing about the topic?

I began looking into drug prices because of a tip about clawbacks – a practice in which pharmacies charge a customer the full copay even if the drug costs much less, and the pharmacy benefit managers “claw back” the rest. Under the contracts pharmacies have with PBMs, neither side can disclose the actual amounts pharmacies pay and PBMs receive.

I’d never heard of the practice, and it sounded like a practice that might prompt great public outrage. What do you mean consumers are being overcharged and the pharmacy is under a gag order not to talk about it? I had no idea at that point how little I understood about the drug pricing world and how many great stories that need to be told about these opaque practices.

I started by interviewing pharmacists, who I’m sure were exasperated to have to explain the role of PBMs and rebates about a dozen times. But it was precisely because these middlemen’s role in the drug pricing pipeline is so hard to understand that I realized these PBMs were the real story. If it was difficult for me to understand – even after several different explanations – the public likely was just as in the dark too.

While public ire over drug prices primarily has been directed at drug manufacturers, I realized that most readers probably have no idea that there were so many different players in the pharmaceutical distribution system. The role of the many players in the system would need to be addressed to fix the problem of skyrocketing drug prices.

At the time, it seemed that legislators didn’t quite understand where they should focus their efforts. It was an opportunity for journalists to educate the public and public officials about how drug pricing works and why they should care, even if many can still get relatively good deals on their prescriptions.

I ended up with a multi-part series of stories that aimed to explain the nuances of this complex system.

Because readers learn differently, I wanted to use several types of media, including video, infographics, and narratives, to tell the story. A colleague who helped me put together this video didn’t even understand the issue until we’d finished it.

The process required me to learn the system backward and forward so that not only could I help my readers and viewers understand it, but also my editors and colleagues as we put the series together. Repeatedly I would stress why we all should care. In each story, I strove to show how we all are footing the bill for high drug prices through higher health care premiums, deductibles and copays.

Finding people who were outraged by the price of EpiPens wasn’t difficult, but it was surprisingly more challenging to find patients who were paying super high prices for life-saving drugs. That’s partly by design since the drug industry has gone to great lengths to make sure consumers are shielded from the direct effect of high prices. I explained this in, Consumer beware: Drug discounts may contain catch.

But through social media and putting the word out to local sources, I eventually interviewed several people who offered fascinating stories:

These patients learned the hard way about the complexities of drug pricing and insurance coverage for specialty drugs and were happy to hear that someone was trying to educate the public about what they faced. From this experience, I recommend that journalists write a teaser story – in my case showing how much you understand about how drug pricing works – that may encourage sources to come forward.

In recent months, Ohio legislators have begun to address the opaque practices of the manufacturers, PBMs, wholesalers and pharmacies. Effective lobbying helped, but I also hope that coverage like mine helped start a deeper dialogue about what drives up drug prices.

After each story in my series published, tips from readers enabled me to write many follow-up stories. I hope my editors will continue to support coverage of this issue because they now understand what I’m talking about when I talk about PBMs, clawbacks, spread pricing and rebates.

If not, I’ll just explain it all again.

Katie Wedell is an award-winning data journalist investigating government waste, fraud and abuse as a member of the I-Team for the Cox Media Group in Ohio. She writes for the Dayton Daily News and the Springfield News-Sun.