Is My Drug Copay Coupon a Form of Charity — Or a Bribe?

Before my insurer had even preapproved coverage of the new injectable medicine my doctor had prescribed, I got a voicemail from its manufacturer informing me that I might qualify for its copay assistance program. That meant the company would cover at least the lion's share of my copay, leaving me with a minimal, if any, out-of-pocket contribution.

My antennae were up: If a drugmaker is offering copay assistance, you can assume the list price of the drug is high, but I wasn't sure how high. Did this outwardly kind offer represent, essentially, a kind of bribe?

This copay coupon scheme is both common and lucrative for pharmaceutical companies that sell expensive drugs. Here's how it works: Drug manufacturers, directly or through nonprofit foundations, disburse money to subsidize patient copays as a form of what they seek to characterize as charity. They often deduct from their income taxes the billions they pay out.

But the federal government sees it differently. It generally considers manufacturers' copay coupons and copay assistance programs to be illegal kickbacksinducing patients to use and doctors to prescribe more expensive drugs when cheaper ones might do. So it severely limits the use of such assistance to patients covered by government insurers, a particular financial hardship for patients on Medicare.