Cut prices or be banned. Are they communists?

Don't be caught off-guard. Drugmakers are facing a new mandate -- cut prices or be banned.

Here's what's afoot. Health plans are increasingly refusing to cover certain drugs unless companies -- including Pfizer (NYSE: PFE  ) and GlaxoSmithKline (NYSE: GSK  ) -- charge less for them.

CVS Caremark, the nation's second-largest pharmacy benefit manager, excluded 70 drugs this year. In 2015, CVS plans to exclude around 200. Express Scripts this year excluded 48 drugs or medical products from its formulary.

Formularies are lists of drugs a health plan covers. Once a drug is dropped from a formulary, individuals have to pay full price, or switch to a rival company's drug. Both Pfizer and Glaxo have been taking a hard line about pricing, and expecting customers to stick with their drugs. But they're finding out that's dead wrong.

When Express Scripts, the nation's biggest pharmacy benefit manager, refused to pay Advair's price last year, Advair volume dropped by 5% (although revenue still increased due to a bump from pricing).

From: http://www.fool.com/investing/general/2014/07/07/the-revolt-against-big-pharmas-astronomical-prices.aspx