Premier report 'inaccurate in reporting drug price profit margins of small distributors' in USA, says Pharma Commerce

A report by Premier healthcare alliance incorrectly calculated the percent markup charged by small distributors in the USA, overstating the high-end by 3,804 percentage points or 521% (The Pharma Letter August 7), according to an exclusive update obtained by Pharmaceutical Commerce, a trade publication that provides news about the pharmaceutical industry. The reported error comes on the heels of the White House stating it was going to look into the profits made by small companies in the industry based on the Premier report (TPL November 1).

The Premier report, "Buyer beware: Drug shortages and the gray market," originally stated that markups averaged 650% and were as high as 4,533%. Pharmaceutical Commerce reported that the revised numbers in fact ranged from 29% to 729% and furthermore noted that the original and even the revised numbers are not necessarily representative of anything at all because the sample base consisted of solicitations that Premier member hospitals chose to send in rather than a true scientific sample of invoices.

"This report is not just inaccurate, it's actually been detrimental to many small distributors out there who are focused only on meeting the needs of patients, hospitals and other providers," said Andy Ataras, secretary for the National Coalition of Pharmaceutical Distributors, which represents the interests of small and independent distributors nationwide. "The report made gross generalizations by taking information provided about a handful of distributors and using it to cast doubt on the entire industry. We knew that when someone followed the dollars, he or she would find that the numbers were overstated," he argued.