A recent report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are directing patients toward more costly medications and restricting their choices for obtaining these drugs. This report follows a 32-month investigation and comes ahead of a hearing featuring executives from the largest PBM firms in the country.
PBMs serve as intermediaries in the prescription drug plan process for health insurers, negotiating prices with pharmaceutical companies and determining out-of-pocket expenses for patients. The three dominant PBMs—Express Scripts, OptumRx from UnitedHealth Group, and Caremark owned by CVS Health—control about 80% of the prescription market in the U.S.
According to the committee’s findings, PBMs maintain lists of preferred medications that tend to favor more expensive brand-name drugs over more affordable generic options. An example highlighted in the report involves emails from Cigna that advised against using cheaper alternatives for Humira, a drug for arthritis and other autoimmune disorders, which was priced at $90,000 annually, while a biosimilar was available for around half that amount.
The report also pointed out that Express Scripts informed patients that they would incur higher costs at their local pharmacies compared to obtaining a three-month prescription via its mail-order service, thus limiting their pharmacy choices.
This investigation aligns with a recent report by the U.S. Federal Trade Commission (FTC), which indicated that the six largest PBMs manage nearly 95% of all prescriptions dispensed in the U.S. The FTC expressed concern about the considerable control these leading PBMs have over the affordability and accessibility of prescription drugs for Americans. It warned that the prioritization of affiliated businesses by vertically integrated PBMs could lead to conflicts of interest, disadvantaging independent pharmacies and inflating drug prices.
FTC Chair Lina M. Khan noted that these findings suggest that PBMs are likely overcharging patients for cancer medications, generating an excess of more than $1 billion in revenue.