Pharmacy Benefit Managers (PBMs) have been the target of increased scrutiny in recent years due in part to rising drug costs and healthcare spending, as well as public mistrust related to a perceived lack of transparency, misaligned incentives, and failure to demonstrate value. Given these factors, a thorough examination of PBMs is understandable, but a broader view of the complex pharmacy supply chain must be taken into consideration. Multiple entities — including pharmaceutical manufacturers, wholesalers and distributors, the US government, group purchasing organizations, health plans, pharmacies, health care providers, and consultants — contribute to challenges related to drug pricing.
Risk Strategies Consulting’s position is that offering financial models based on a true net-acquisition cost basis may be in the best interest of PBMs and their customers. This highly disruptive model is intended to remove existing distrust and enable PBMs to demonstrate value propositions tied to operational excellence, optimal clinical and financial outcomes, enhanced member and provider experience, and health equity. It may also increase the accountability of other participants in the supply chain.
A Focus on Multi-Condition Drugs and Treatments for Rare Diseases
Manufacturers are focusing research and development (R&D) efforts on two key areas: multi-condition drugs and therapies for rare diseases. These strategies have the potential to reshape the future of medicine and address critical gaps in care.
Multi-conditional drugs used to treat multiple indications are not a new concept in the pharmaceutical industry, with older medications such as aspirin and paroxetine serving as just two examples of this strategy. In more recent years, specialty medications such as Humira and targeted oncology medications like Keytruda have gained multiple approvals, and GLP-1 drugs initially approved to treat type 2 diabetes now have expanded indications for weight loss, Cardiovascular disease (CVD) prevention, and even obstructive sleep apnea. Adopting a multi-condition approach to drug development can have benefits for both manufacturers and patients. The average new drug approval process can take 10 to 15 years and cost between $314M and $4.46B.1,2 Supplemental approvals of existing drugs, on the other hand, require fewer steps and take an average of only six years to come to market, ultimately reducing the cost of development for a manufacturer.3 The shorter timeframe to approval is an advantage to patients as well, offering more treatment options faster.
Manufacturers have also dedicated significant R&D to rare disease therapies. A rare disease is a condition that affects less than 200,000 Americans.4 There are more than 10,000 rare diseases collectively affecting over 30 million people in the United States.4,5 Despite the progress made in recent years towards treating rare diseases, an estimated 95% still do not have any known treatment.5 Historically, manufacturers were less likely to develop medications for rare diseases because of the complex nature of the drugs themselves, a lack of individuals to enroll in clinical trials, and a lack of financial incentives. The approval of the Orphan Drug Act (ODA) in 1983 paved the way for tax credits, select fee exemptions, and seven years of market exclusivity to incentivize manufacturers to develop rare disease therapies.6 Since ODA’s inception, over 6,300 orphan drug status approvals have been granted across 1,079 rare diseases.7 The US Food and Drug Administration (FDA) is currently conducting two pilot programs, Rare Disease Endpoint Advancement (RDEA) and Support for Clinical Trials Advancing Rare Disease Therapeutics, to further facilitate rare disease drug development.8,9 In addition to orphan drug designation, additional FDA designations and approval pathways can help accelerate the approval timeline for rare disease drugs.10
The focus on development of multi-conditional drugs and rare disease therapies highlights both strong market potential and a commitment to advancing medical innovations. However, it is important to not lose sight of whether these strategies primarily serve manufacturers’ interest or truly align with broader healthcare goals and patient needs.
Our team of pharmacy and clinical specialists provides strategic guidance and insights into the rapid pace of pharmacy and pharmacy benefits. Learn more about Risk Strategies Consulting here.
- Accelerated Approval: Finding a Path to Get Needed Treatments to Patients Faster. Eli Lilly and Company. 2023, June 23. Accessed July 25, 2025. https://www.lilly.com/news/stories/accelerated-approval-get-needed-treatments-patients
- Sertkaya A, Beleche T, Jessup A, Sommers BD. Costs of Drug Development and Research and Development Intensity in the US, 2000-2018. JAMA Netw Open. 2024;7(6):e2415445. doi:10.1001/jamanetworkopen.2024.15445
- Kim H. S. (2022). Drug Repositioning: Exploring New Indications for Existing Drug-Disease Relationships. Endocrinology and metabolism (Seoul, Korea), 37(1), 62–64. https://doi.org/10.3803/EnM.2022.1403
- NORD Rare Disease Database. National Organization for Rare Disorders. Accessed July 25, 2025. https://rarediseases.org/rare-diseases/
- IQVIA Institute for Human Data Science. The Use of Medicines in the U.S. 2024: Usage and Spending Trends and Outlook to 2028. April 2024. Available from www.iqviainstitute.org
- Designating and Orphan Product: Drugs and Biological Products. U.S. Food and Drug Administration. Updated August 12, 2024. Accessed July 25, 2025. https://www.fda.gov/industry/medical-products-rare-diseases-and-conditions/designating-orphan-product-drugs-and-biological-products
- Fermaglich, L. J., & Miller, K. L. (2023). A comprehensive study of the rare diseases and conditions targeted by orphan drug designations and approvals over the forty years of the Orphan Drug Act. Orphanet journal of rare diseases, 18(1), 163. https://doi.org/10.1186/s13023-023-02790-7
- Rare Disease Endpoint Advancement Pilot Program. U.S. Food and Drug Administration. Updated January 3, 2024. Accessed July 25, 2025. https://www.fda.gov/drugs/development-resources/rare-disease-endpoint-advancement-pilot-program
- FDA Launches Pilot Program to Help Further Accelerate Development of Rare Disease Therapies. U.S. Food and Drug Administration. Updated September 29, 2023. Accessed July 25, 2025. https://www.fda.gov/news-events/press-announcements/fda-launches-pilot-program-help-further-accelerate-development-rare-disease-therapies
- Fast Track, Breakthrough Therapy, Accelerated Approval, Priority Review. U.S. Food and Drug Administration. Updated June 12, 2023. Accessed July 25, 2025. https://www.fda.gov/patients/learn-about-drug-and-device-approvals/fast-track-breakthrough-therapy-accelerated-approval-priority-review
