A new report from the House Committee on Oversight and Accountability claims that pharmacy-benefit managers (PBMs) are guiding patients towards more expensive medications while restricting their options for where to obtain them.
The report, obtained by the Wall Street Journal, is the result of a 32-month investigation by the committee in anticipation of a hearing involving executives from the largest PBMs in the country.
PBMs act as intermediaries for prescription drug plans on behalf of health insurers. They negotiate prices with pharmaceutical companies and determine out-of-pocket costs for patients. The three largest PBMs in the U.S.—Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark—manage about 80% of prescriptions in the country.
The committee’s findings indicate that PBMs often compile lists of preferred medications that feature higher-priced brand-name drugs instead of cheaper alternatives. For instance, emails from Cigna employees reportedly discouraged the use of less expensive alternatives to Humira, an arthritis treatment that was priced at $90,000 annually when more affordable biosimilars were available for half that amount.
Additionally, Express Scripts informed patients that filling a prescription at their local pharmacy would likely be more costly than obtaining a three-month supply from its affiliated mail-order service. This practice limits patients’ pharmacy options.
In a related development, the U.S. Federal Trade Commission (FTC) released a report earlier this month stating that rising vertical integration in the industry has led the six largest PBMs to manage nearly 95% of all U.S. prescriptions.
The FTC underscored serious concerns regarding the power these leading PBMs hold over Americans’ access to affordable prescription medications, suggesting that the arrangement may favor their own affiliated businesses, creating conflicts of interest that could disadvantage competing pharmacies and drive up drug prices.
FTC Chair Lina M. Khan highlighted that these middlemen are reportedly overcharging patients for cancer treatments, generating over $1 billion in additional revenue.