Delaware Public Media

Delaware's initial try to reduce drug prices didn't pan out

Mar 11, 2019

Attempts to use federal support to lower drug prices in Delaware have failed so far and now the state is exploring new strategies.

Last year a coalition of five state agencies and two First State hospitals received just under $90,000 from the National Academy for State Health Policy to try to reduce the cost each entity pays for pharmaceuticals.

The five state agencies are The Delaware Health Care Commission, the Division of Medicaid and Medical Assistance, the State Benefits Office, the Department of Correction and the Division of Public Health. The hospitals are Christiana Care Health System and Bayhealth.

The plan was to identify the most cost-effective and clinically appropriate drugs and then adopt uniform purchasing practices among the seven entities.

Division of Medicaid Pharmacy Director Cynthia Denemark says it didn’t work.

“What we found is most of the preferred drug lists and formularies are very much aligned, so there wasn’t a lot that we could do to modify those benefit plans to bring down the cost,” said Denemark.

Denemark adds the group unsuccessfully tried to collectively negotiate rebates from drug manufacturers.

“That failed to yield any significant opportunities,” she said. “But we looked at that and we continue to look at other arrangements with drug manufacturers.”

But the NASHP grant also allows Delaware to participate in an interstate work group to try to drive down drug costs. Delaware’s Medicaid Director Stephen Groff says discussions on that front are ongoing.

“Louisiana is pursuing this innovative—what they call—a Netflix subscription-type model. Some states are looking at importation. Some states are looking at building consortiums,” said Groff. “We definitely want to be part of that conversation.”

State officials say that while some initial attempts to reduce costs have failed, Delaware’s largest drug purchasers, like the Department of Correction and the Division of Statewide Employee Benefits, are still communicating on this issue.