The Right Price

A major pharmaceutical company made a decision several years ago that made good business sense--give big volume customers such as HMOs discounted prices to help improve sales of branded drugs.

"It was economically sensible to offer the discount because the HMO, unlike the retailer, had control over its buying population and therefore could help drive sales," says Peter Thomas, a partner at Simpson Thacher & Bartlett.

Ironically, although the future looks bleak for a recommendation that follows naturally on two decades of jurisprudence, it looks brighter for a recommendation that seeks to overturn the High Court.

Consolidating Claims

So while it's unclear just what the recommendations will engender or when they might achieve fruition, some see hope in the mere fact that Congress will finally have concrete proposals for change before it.

"The sheer momentum of the commission's recommendations might just start the ball rolling on modernization," Talady says.


Julius Melnitzer

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