A recent report from the House Committee on Oversight and Accountability has revealed that pharmacy-benefit managers (PBMs) are directing patients toward more expensive medications while restricting their pharmacy options. This report, highlighted by the Wall Street Journal, comes after a 32-month investigation by the committee in advance of a hearing featuring executives from the largest PBMs in the country.
PBMs act as intermediaries for prescription drug plans offered by health insurers, negotiating prices with pharmaceutical companies and determining out-of-pocket expenses for consumers. The three dominant 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 indicated that PBMs are promoting high-cost brand-name drugs on their preferred drug lists instead of cheaper options. The report includes evidence from Cigna emails that discouraged the use of more affordable alternatives to Humira, a medication for arthritis and other autoimmune diseases, which was priced at $90,000 annually, despite the availability of a biosimilar at half the price.
Additionally, patients were informed by Express Scripts that they would incur higher costs when filling prescriptions at local pharmacies compared to getting a three-month supply from the company’s mail-order service. This practice restricts patients’ choices regarding where they can access their medications.
In a similar vein, the U.S. Federal Trade Commission (FTC) issued its own report earlier this month, stating that increasing vertical integration among PBMs has led to these six largest PBMs managing nearly 95% of all prescriptions in the U.S. According to the FTC, this concentration allows PBMs significant control over how Americans access and afford their medications, creating conflicts of interest that may disadvantage independent pharmacies and drive up drug costs.
FTC Chair Lina M. Khan emphasized that these middlemen are effectively “overcharging patients for cancer drugs,” resulting in over $1 billion in additional revenue for the PBMs.