A recent report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are directing patients towards more expensive medications while restricting their pharmacy options. The report, which followed a lengthy 32-month investigation, will be addressed in an upcoming hearing involving key executives from the largest PBMs.
PBMs serve as intermediaries in prescription drug plans for health insurers, negotiating prices with pharmaceutical companies and determining patient out-of-pocket costs. The top three PBMs—Express Scripts, OptumRx from UnitedHealth Group, and CVS Health’s Caremark—currently manage around 80% of all prescriptions in the United States.
The committee’s findings indicate that PBMs have formulated lists of preferred medications that favor higher-priced brand-name drugs over more affordable alternatives. For instance, emails from Cigna employees highlighted discouragement against opting for cost-effective substitutes for Humira, a medication costing $90,000 annually, despite a biosimilar being available at half that price.
Additionally, the committee discovered that Express Scripts informed patients they would pay more for prescriptions at local pharmacies compared to ordering a three-month supply through its associated mail-order pharmacy, thereby limiting patient pharmacy choices.
The U.S. Federal Trade Commission (FTC) released a similar report earlier this month, noting that increased vertical integration has allowed the six leading PBMs to control nearly 95% of all prescriptions in the country. The FTC expressed concern about the significant power PBMs hold over Americans’ access to affordable prescription medications and highlighted potential conflicts of interest arising from PBMs favoring their affiliated businesses.
FTC Chair Lina M. Khan emphasized that these middlemen are contributing to increased costs for cancer medications, generating over $1 billion in additional revenue from patients.