1. Mail Order Pharmacy What You Don’t Know Will Hurt You!

2. Mail Order Pharmacy Builds a case for savings through: Perceived Discounts Not Actual Dollars

3. Example: Brand Name Prescription Retail Pricing AWP – 14% Mail PricingAWP – 22% Brand PrescriptionAWP - $100.00 RetailAWP – 14% 100.00 – 14.00 = $86.00 Mail OrderAWP – 22% 100.00 – 22.00 = $78.00 $8.00 Savings

4. Mail Order Alters or Uses Higher AWP Products Mail OrderAWP – 22% 150.00 – 33.00 = $117.00 RetailAWP – 14% 100.00 – 14.00 = $86.00 - $31.00

5. Example DMGRetail MAC MAC 1MAC 2MAC 3MAC 4MAC 5 Generic Drug 1.20.30.40.50.60.70 Generic Drug 2.50.751.001.101.251.35 Generic Prescription: Retail Pricing: MAC Pricing set at $0.20 x 60 = $12.00 Mail Pricing: AWP – 50% AWP = $1.00 x 60 = $60.00 60.00 - 50% = $30.00 - $ 18.00

6. Co-Pay Issue Retail co-pay Pfizer Study MAC co-pay $30.00 X 3 $90.00 $30.00 / per one 3 month supply Payer picks up $60.00 of cost. *If prescription is not $60.00 cheaper, then government costs go up.

7. Lipitor - Redbook

8. Repackaging Example: Lipitor 20mg #30 At RetailAt Retail Pharmacy Paid AWP-14% + $2.00 AWP* = $4.16/tablet 30 x $4.16 = $124.80 $124.80 - $17.47 + $2.00 = $109.33 At Mail OrderAt Mail Order Pharmacy Paid AWP-22% + $0.00 AWP* = $6.81/tablet 30 x $6.81 = $ 204.30 $204.30 - $44.95 + $0.00 = $159.35 $50.02 more at Mail Order vs. Retail *2007 Red Book Pricing