Benfits Merger Worry For Pharma Companies

Two pharmacy benefits companies are set to merge in a multi-billion dollar deal, reports fiercepharma.com.

Pharmaceutical companies are beginning to worry that due to the proposed $29 billion deal that will see Express Scripts buy Medco Health Solutions, drug prices could decrease, affecting the pharamceutical compnies profits. Most who have commented on the deal, including Eli Lilly’s CFO Dernica Rice, have played down the impact the buy-out will have, with Rice saying Lilly could maintain its negotiation power through their products advantage over the generic drugs on the market.

However, Michael Luby, of BioPharma Alliance, believes the merger will mean the combined company would have “extraordinary purchasing power… [and] leverage [over] pharmaceutical companies.” Price cuts in Europe; particularly Germany and Spain, have been causing pharmaceutical companies problems, and having staved off effort from the US government over pricing, the big companies are now going to have to attempt to stop the private sector submitting the pharmaceutical sector to the same pricing measures.

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