A recent report from the House Committee on Oversight and Accountability suggests that pharmacy-benefit managers (PBMs) are guiding patients towards more expensive medications while restricting their options for pharmacies. This report, referenced by the Wall Street Journal, comes after a 32-month investigation into the practices of the largest PBMs in the country and is part of preparations for an upcoming hearing involving executives from these organizations.
PBMs serve as third-party administrators for prescription drug plans offered by health insurers. They negotiate pricing with pharmaceutical companies and determine patients’ out-of-pocket expenses for medications. The three largest PBMs in the U.S.—Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark—manage about 80% of the nation’s prescriptions.
The committee’s findings indicate that PBMs often compile lists of preferred medications that prioritize pricier brand-name drugs instead of more affordable alternatives. For instance, the report includes instances of Cigna employees discouraging the use of cheaper options for Humira, a drug for arthritis and autoimmune diseases priced at approximately $90,000 annually, despite the availability of a biosimilar at half the cost.
Moreover, the committee discovered that Express Scripts informed patients they would pay less for a three-month supply of medication through its affiliated mail-order service compared to local pharmacies, thereby restricting patients’ choices regarding where to fill their prescriptions.
In a related finding, the U.S. Federal Trade Commission (FTC) released a report indicating that the largest six PBMs control nearly 95% of all prescriptions dispensed in the U.S. The FTC report expressed concern over the significant influence PBMs hold over Americans’ access to affordable medications. FTC Chair Lina M. Khan noted that these middlemen are increasing costs for patients, particularly for cancer treatments, generating over $1 billion in additional revenue for themselves.