A recent report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are directing patients towards more expensive medications and restricting their pharmacy options. This follows a lengthy 32-month investigation by the committee prior to a hearing involving executives from the leading PBMs.
PBMs serve as intermediaries for prescription drug plans, negotiating with pharmaceutical companies on prices and determining out-of-pocket costs for patients. The three largest PBMs in the U.S.—Express Scripts, OptumRx (part of UnitedHealth Group), and CVS Health’s Caremark—handle around 80% of prescriptions nationwide.
The committee’s findings indicate that PBMs tend to create preferred drug lists that favor higher-priced branded medications over more affordable alternatives. For instance, internal communications from Cigna were cited in the report, noting discouragement of cheaper options for Humira, which costs approximately $90,000 annually, despite the availability of a biosimilar at half that price.
Furthermore, the report highlighted practices by Express Scripts that informed patients they would incur higher costs if they opted to fill prescriptions at local pharmacies compared to obtaining a three-month supply through its mail-order service. This practice effectively limited patients’ choices regarding where to fill their prescriptions.
Earlier this month, the U.S. Federal Trade Commission (FTC) released a similar report detailing how increased vertical integration and concentration have allowed the six largest PBMs to manage nearly 95% of all prescriptions dispensed in the country. The FTC’s report expressed concern over the growing power of PBMs in relation to Americans’ access to affordable medications. It noted potential conflicts of interest, stating that the vertically integrated structure of these PBMs may incentivize preferential treatment toward their affiliated pharmacies, ultimately raising drug costs.
FTC Chair Lina M. Khan emphasized the report’s findings, which suggest that these middlemen are “overcharging patients for cancer drugs,” leading to an additional revenue stream exceeding $1 billion.