A recent report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are directing patients toward more costly medications while restricting their pharmacy options.
The report, which comes after a 32-month investigation, was highlighted in the Wall Street Journal and precedes a hearing involving executives from major PBM companies.
PBMs act as intermediaries for health insurers, negotiating drug prices with pharmaceutical companies and determining patients’ out-of-pocket expenses. The three largest PBMs in the U.S.—Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark—control nearly 80% of the prescription market.
Key findings from the committee’s report indicate that PBMs often promote higher-priced brand-name drugs over cheaper alternatives. For instance, internal communications at Cigna discouraged the use of less expensive alternatives to Humira, an arthritis treatment that costs around $90,000 annually, even though a more affordable biosimilar was available for half that price.
Moreover, the committee discovered that Express Scripts informed patients that filling prescriptions at local pharmacies would be more expensive than obtaining a three-month supply through its mail-order service, which effectively limited patient choice.
Earlier this month, the U.S. Federal Trade Commission (FTC) released a similar report indicating that the six largest PBMs manage nearly 95% of all U.S. prescriptions, a level of consolidation that raises concerns.
The FTC’s findings suggest that PBMs wield considerable influence over Americans’ access to affordable medications. This situation has created a conflict of interest, where vertically integrated PBMs might favor their affiliated entities, disadvantaging independent pharmacies and pushing up drug prices.
FTC Chair Lina M. Khan commented that the report indicates these intermediaries are charging patients excessively for cancer medications, resulting in over $1 billion in additional revenue for them.