Private payers reportedly receive rebates between 30 and 70 percent for medicines that treat a number of chronic conditions including diabetes, asthma, hepatitis C and high cholesterol. Yet, these negotiated discounts are not shared with patients who pay a deductible or a coinsurance -- a percentage of costs a patient is responsible for paying out of pocket -- for their medicine at the pharmacy. No patient should pay more for their medicine than their insurer.

The share of health care spending attributable to medicines in the United States is in line with that of other countries like Canada, France, Germany and Japan. Unlike foreign governments that often set prices and restrict coverage as a condition of entering the market, the United States relies on its competitive marketplace to control costs and provide patients with access to medicines far earlier.

In recent years, pharmacy benefit managers and insurers have been increasingly shifting more health care costs to patients. Since 2006, deductibles have increased almost 350 percent and there has been an 89 percent rise in what patients pay in coinsurance, which is a percentage of costs associated with their health care service or medicine. Coupon programs - offered by biopharmaceutical companies - provide a valuable source of assistance for many commercially insured patients who are facing rising out-of-pocket costs because of their insurance coverage.

Hospitals mark up medicine prices nearly 500 percent, and one in every five hospitals marks up the price of medicine by at least 700 percent. For a medicine with a list price of $150, this markup could cost patients up to $1,050. Insurers pay for medicines administered in hospital outpatient settings differently than those purchased at a pharmacy. Even after negotiations with commercial payers, hospitals still receive nearly 2.5 times what they paid to acquire the medicine. For example, many cancer treatments are provided in a hospital facility where the hospital purchases the medicine directly and is then reimbursed by the patient's insurer—often at a steep markup. Importantly, this is a conservative estimate as it does not take into account the impact of the 340B program. The 340B program was designed to increase access to medicines for vulnerable or uninsured patients through safety-net facilities, but all signs point to 340B doing the opposite.

Too often patients have to fight to access breakthrough medicines that are revolutionizing how we fight disease. We can improve patient access and affordability by changing the incentives in the supply chain so that more of the negotiated rebates and discounts are used to lower costs for patients at the pharmacy counter.