Behind the true-to-life historical oligarchy of Sheriff Riley Gore (in Carla Rising) was the coal industry, cynically named by the resistance of that time as “King Coal.”

credit: Wikimedia Commons

Today, the pharmaceutical industry — “Big Pharma” — is calling many of the shots in Appalachia and other parts of the United States. Public health officials in West Virginia have been watching these developments for years, a crisis that builds with the participation of state and national power brokers, including elected officials, escaping the attention of most news outlets.

Writing in The American Prospect, journalist David Dayan describes the role of Pharmacy Benefit Managers (PBMs), the “middlemen” of the US pharmaceutical supply chain. The PBMs work with drug manufacturers, health plans, and pharmacists to lower prices for US consumers across the system — that is, according to the de-regulatory “free-market ideal” being touted in Washington today.

With PBMs, however, it hasn’t turned out that way, according to the story. Instead, we see that a complete lack of pricing transparency — along with systematic kickbacks and conflicts-of-interest — have allowed PBMs to muscle profits from the other players. In other words, we see a handful of industry managers, busy drawing their own private gain as they fail at their core “market” function:  keeping drug prices low. (Makers of OxyContin, for example, reportedly paid PBMs to keep prescriptions flowing into places like West Virginia, where authorities turn a blind eye, at best.)

Not surprisingly, the US PBMs now appear to have become a monopoly industry, in which three players control 80% of the market. Their alliances with pharmacies have made them a competitor to companies with whom they are negotiating, according to The American Prospect story.

People who want to understand the US prescription drug crisis — whose biggest distributors persistently escape the scrutiny of criminal prosecutors — should take a look.  Here’s the link again.