FOR IMMEDIATE RELEASE April 10, 2002

CONTACT: Kati Anderson (202) 628-3030 kanderson@familiesusa.org

RESPONSE TO DRUG COMPANIES' NEW "TOGETHER Rx CARD" PROGRAM

The following is a statement by Ron Pollack, executive director of Families USA, regarding several drug companies' announcement about a new discount card program - "Together Rx Card" - for Medicare beneficiaries:

"The drug companies' joint discount program is the clearest admission to date from the industry that prescription drug costs are unaffordable for many millions of seniors. As seniors learn what the General Accounting Office has already found - namely, that private drug discount card programs typically result in merely 10 percent, not 20 to 40 percent, savings - seniors' demands for a prescription drug benefit in Medicare will continue to intensify.

" It is noteworthy that the companies indicated that each company will set its own discounts independently with a minimum discount of 15 percent off its list price to wholesalers. They also indicate that products offered are subject to change.

"These caveats raise a cautionary flag that all seniors should understand. In effect, the drug companies are alerting us to a potential shell game in the pricing of drugs. Although discounts of 15 percent or more may be announced, those discounts will apply to company-established wholesale prices that the companies admit are likely to rise. Therefore, the real discounts received by seniors will be considerably smaller than 15 percent off the prices they pay today, and the drugs subject to those discounts are likely to change.

"In effect, this proposal may result in more public relations benefit for the companies than real relief for America's seniors."

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Families USA is the national organization for health care consumers. It is non-profit and non-partisan and advocates for high-quality, affordable health and long-term care for all Americans.