health records, thus bypassing the safety check on drug–drug interactions that may otherwise flag a potential error (Chew et al., 2000; Groves et al., 2003; Taira et al., 2003). Furthermore, free samples are most often the newest, least well tested drugs, and patients are thus being encouraged to take these drugs when others might, in fact, be safer for them (Avorn, 2004). (See the discussion in Chapter 6.)

Companies also interact with insurance payers and PBMs to secure listing and reimbursement pricing in drug formularies. A formulary is a payer’s list of covered drugs, designed to restrict the listing of drugs and/or the level of coverage in each therapeutic class for cost-saving purposes (Husakamp et al., 2003). Unlike other nations that use formularies to determine access, payers in the United States maintain an open system to accommodate the broadest population and its potential medication needs; formularies for prescription drugs are used solely to determine tiered copayment and reimbursement structures, not access. For example, the Veteran Health Administration (VHA), private-sector health maintenance organizations (HMOs), private-sector payers, and now the Centers for Medicare and Medicaid (CMS) with the new prescription drug benefit use open formularies, although coverage is tiered (also called incentive based) (Thomas, 2003; Landon et al., 2004; Shrank et al., 2005). HMOs tend to have more restrictive formularies (prohibiting payment for certain drugs), but many have also moved to tiered structures (Shrank et al., 2005). (See Box 2-3 for a summary of key problems with the manufacturing, distribution, and marketing process.)

The steps described above provide the basic foundation for safety in producing and distributing medications that meet consumers’ medical and