As the so-called "Doughnut Hole" coverage contribution comes online, in the United States in 2011, Merck is likely to shell out over $142 million in discounts -- just for that portion. This amount will rise, in future years. Here is Bloomberg's reporting overnight:
. . . .Also among the top 10 companies whose drugs are used by Medicare beneficiaries in the doughnut hole are Ingelheim, Germany-based Boehringer Ingelheim at $312 million; Novartis AG of Basel, Switzerland at $303 million; London-based GlaxoSmithKline Plc at $284 million; Merck & Co. of Whitehouse Station, New Jersey, at $282 million; Indianapolis-based Eli Lilly & Co. at $250 million; Eisai Co. of Tokyo at $242 million; and Tokyo-based Takeda Pharmaceutical Co. at $202 million. Those companies’ drug sales made up 63 percent of all sales in the doughnut hole. Like Pfizer, they have agreed to offer a 50 percent discount. . . .
This is the right thing to do -- but it will likely crimp US earnings on branded drugs, to the extent that seniors did not, in the past, simply stop buying (and taking) their branded medications when they reached the doughnut's hole, each year. We shall see.
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