Dear Mr. Bezos - I've got this crazy new idea about disrupting the drug industry

Dear Mr. B -

I know that so many people in healthcare and the media are desperately guessing at what you're looking to do. Perhaps Amazon is disrupting the PBMs or initiating a streamlined medical supply chain. Maybe it's secretly looking to unleash a chain of convenient telehealth kiosks in Whole Foods that partner with local health systems.

After all, your public announcement of interest in the healthcare space helped created quite a stir. Many of the 'big boys' and their shareholders clearly noticed this back in January.

Clearly, the thought of an Amazon 'pharmacy' played a role in CVS's decision to acquire Aetna, Cigna's proposed purchase of Express Scripts, and even the recent consideration of Walmart's partnering with, or acquisition of Humana.

I have to say Mr. B - many of us little guys (err...patients & healthcare consumers) took inspiration from your boldness. It sure seemed that you, Jamie and Warren were blowing a lot more than hot air. It actually sounded like a roaring call for consumer-based competition.

I wondered if your call for competitive consumerism in healthcare had truly been heard. Later, I later learned that Aetna and United announced passing down their discounted PBM rates to the benefit of 3 million and 7 million of their members respectively. Though one should note that these shared members constitute only a small portion (8% and 14) of both payers' total bases.

Yet while the new dawn of healthcare consumerism began to rise, I saw storm clouds quickly coming to fill the sky...and THEY carried a name...

Co-Pay Accumulators

This caught me by surprise Mr. B. It will likely cause surprise, anger and financial anguish for many patients and drug customers this year.

This co-pay accumulator provision carries differing, catchy euphemisms such as “Coupon Adjustment: Benefit Plan Protection program” or “Out of Pocket Protection program." (1)

Nonetheless, it is estimated to be on as much as 20% of all payer and employer sponsored healthcare plans in 2018.

As you well know, many drug companies have for years given their customers a benefit in the form of a copay card or coupon to help them meet their rising deductible or out-of-pocket cap. This resulted in an increase of filled prescriptions from 13% to 19% from 2013 to 2016 (2).

Many of these were with specialty or brand-name drugs listed on plan member 'tiers' - or perhaps the drugs were on no tiers whatsoever. So these cards did help many to afford and utilize these best medications recommended by their doctors.

Sir, I would hate to be a fly-on-the-wall when these patients find out that their drug discount cards are no longer contributing to their out-of-pocket costs. I cannot imagine the surprise, fear and anger that will come when they open their EOB and find out their new and added financial responsibility.

The flip side of course, is that drug companies often give out these coupons in the first place in a clear attempt to mask their massively inflated price increases. These price increases coupled with an increased Medicare population shift (with limited pricing negotiation) have clearly marked a substantial drug spend for our country.

Meanwhile, nearly $15 of every $100 spent on brand-name drugs goes to PBMs; and the share of annual drug price increases they pocket – as opposed to pass on to consumers – has soared from 5 percent in 2011 to 62 percent in 2016. (3)

As we see drug manufacturers, PBMs and payers all finger-pointing at each other, the consumer continues to take the brunt. This in a system which has been kept purposely complex, thwarting true understanding for many American patients, plan members and drug customers.

MY PROPOSED SOLUTION

I'm selectively looking for a full-time position Mr. B. - just saying. So I hope that I don't ruin my chances with being overtly transparent on criticism and applying some lateral thinking toward this challenge.

Because I still think Amazon can and should win.

Yes, I know that Amazon recently came out with news that it was pulling back from pharmaceuticals. It was disheartening to be sure...but Sir, I think this is an excellent time to take a different and unique approach. We'll call upon the great words form the leader Hannibal, whose mantra was to find a way - or make one.

Hey, I get it. The PBMs have entrenched themselves into a situation where they have heavy contracts, political influence, and partnering relationships with pharmacies and payers. They are inserted into our healthcare system in a way that would be difficult, costly and timely to compete head-on against.

Let's keep in mind these 10 KEY POINTS:

• Our current healthcare system has both thrived and survived by the power of regulated pricing and passing down hyperinflated costs to employers and consumers with or no choice for options.
• The term 'value' means different things to different healthcare players. Also, healthcare 'cost' is not equivalent in meaning to patient or health consumer 'pricing'.
• Drug savings are entirely possible for consumers - but are often captured and held by PBMs & payers.
• Payers and now non-healthcare companies are seeking to partner with or acquire PBMs as they are extremely profitable, touch many patients, and are less-regulated than other health industries. They are counting on the PBM space to remain this way.
• Drug companies must be made to compete on pricing driven by consumers. It is their responsibility to figure out how to make costs and R&D fit from that.
• Most everyone in the U.S. recognizes drug pricing is far too high and unaffordable.
• Any substantial disruption in drug pricing is going to cause job shedding and share price decreases. We will have to lose in the short term to gain true sustainability in the future.
• Politicians take money from all industry players in healthcare - but only survive through catering to their constituents. They have played off this situation by behaving with finger-pointing, a showing of leadership weakness, and taking actions that serve their political needs before the countries best interests. Shine a light on this with a publicly popular solution, and they will change their actions.
• The media needs people to watch their stations. They need to support, cover, and catalyze obvious solutions through their opinion news and shows.
• We have 142 million and largely happy, trusting customers.

How to Start?

1. We at Amazon build an online platform. Of course..secure and scalable on our AWS cloud. Sure, we can also look to include NLP, AI, machine learning - but let's first focus on the getting this train rolling with the basic system, players and flow.

On one side of this solution will be pharma company clients who are looking to grow, increase health consumer relationships, and build/sustain customer loyalty themselves.

On the other side will be end-user pharma customers who will be partnered with their providers.

The customer could also be represented by a 'drug advocate' - a trained individual, nurse, doctor, family member, or perhaps a remote case worker.

The pharma companies will offer users the same discounts as they do with current drug card programs - or better. However, instead of people having to ask for it from their middleman doctor or call in from some fast-talking TV commercial, they will be able to take their time and compare while they shop 24/7/365.

Oh did I say shop?

Yes - customers and their drug advisors will connect in verified conditions (diagnoses) as well as existing medications - likely through a connection via hospital or health system EHRs. One entered in, a host of drug companies and their pharmaceuticals will be matched up, based on criteria and company offering.

Each of these companies would create best-fitting medications for the diagnosis/condition, and 'best discounts'. The discounts can be based on financial information, eventually given from the patients' end.

Maybe it's 35% off for 6 months...a 60-day free starter trial...or maybe there's even a way to connect in people, willing to participate in drug trials.

Will the patient have to trade off loyalty, a pre-payment, or perhaps some other variable commitment? So long as the drug is not hurting but helping them...why not?

After all, drug companies are looking for long-term loyalty - and if they can directly hit upon a core patient value point - both sides should be happy. And the EHR could perhaps be made to share limited information with the drug company certifying its current effectiveness - plus we can positively impact medication adherence.

So if a patient is taking a certain blood pressure medication that has become too expensive - perhaps they find two others that are selected as comparable in effectiveness and appropriateness. They hit a button, pass these options to the EHR and notify their doctor for evaluation and decisioning on viability.

The doctor makes their best selection and messages the patient (via portal or other service) showing them. The information might also carry relates studies or stats on each drug as well, for greater transparency. If the patient agrees with doctor's wishes, they click a button, attesting, and then triggering an automated prescription to be sent out to the patient's pharmacy with the discount.

2. Now, start signing up your members. This can and should be before the product is actually complete. Amazon reached out to its 142 million customers in the U.S. and clearly communicates on an 8th grade level stating:

• Here's what's BEEN happening and how it doesn't benefit consumers
• Here's our proposed solution and what it will improve for drug pricing and competition
• Show demo video of how it would work AND the benefit
• Show drug companies who are supportive of the model - as well as many different provider and healthcare advocacy/consumer groups.
• Ask them to click to sign up and check a clearly marked box if they elected to also have an automatically support email (via AWS cloud service) sent with their name TO both their local Congressman and Senator, asking for their support.
• Gather the numbers and rally the positive message about growing support from Americans.

3. Go on the offensive with a proactive media blitz, hiring political lobbying groups (state and federal), strategic partnering, and going on the offensive to deliver this idea to the American public. Make transparent to ALL of Amazon's customers and the media which politicians, health care companies/leaders, and media outlets DO and DON'T support this.

Then watch the scramble begin as two words - AMAZON PHARMA seep into the public consciousness.

Let that sit up against politicians who seem to always be positioning and campaigning to keep their jobs. Money and votes have such a funny way of shifting perspectives. Not to mention shareholders who will be consistently evaluating whether they believe that growing healthcare consumerism won't find a way out of this half-century old cage.

And if you need a passionate team leader Sir...I know someone with interest.

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1. Adam J. Fein, P. (2018). Copay Accumulators: Costly Consequences of a New Cost-Shifting Pharmacy Benefit . [online] Drugchannels.net. Available at: https://www.drugchannels.net/2018/01/copay-accumulators-costly-consequences.html
2. Mmm-online.com. (2018). MM&M - Medical Marketing and Media. [online] Available at: https://www.mmm-online.com/commercial/pbms-drugmakers-face-off-over-copay-accumulators/article/759207/
3. Morning Consult. (2018). Who's Stealing My Savings?. [online] Available at: https://morningconsult.com/opinions/whos-stealing-my-savings/

DR. STEVE AMBROSE is a highly-dynamic healthcare leader & influencer who carries relationships with many senior executives in multiple industry segments.

He has a 20+ year history in patient targeting, engagement, acquisition and retention. He has more recently led strategy and marketing communications for a national online consumer company with millions of customers.

He is current receiving & reviewing full-time leadership/team role opportunities. Separately, he advises companies on a paid basis. CV + Interests HERE.

Steve founded and hosts the Red Hot Healthcare podcast. He and his wife recently co-founded the fast-growing ??Walk The Ridge movement for improving the online and workplace practice of civility in January 2018.