A recent report from the House Committee on Oversight and Accountability has revealed that pharmacy-benefit managers (PBMs) are directing patients toward more costly medications and restricting pharmacy options. This report, reviewed by the Wall Street Journal, comes after a 32-month investigation by the committee ahead of a hearing involving executives from the largest PBMs in the country.
PBMs act as intermediaries for health insurers in managing prescription drug plans. They negotiate prices with pharmaceutical companies and determine the out-of-pocket costs for patients. The three largest PBMs in the U.S.—Express Scripts, OptumRx (part of UnitedHealth Group), and Caremark (a CVS Health subsidiary)—control about 80% of all prescriptions.
According to the committee’s findings, these managers have established preferred drug lists favoring higher-priced brand-name medications over less expensive alternatives. For instance, emails from Cigna employees discouraged prescribing cheaper options to Humira, a drug for arthritis and other autoimmune disorders that cost around $90,000 annually, although at least one biosimilar was available for about half that price.
The report also noted that Express Scripts informed patients they would incur higher costs if they filled prescriptions at local pharmacies compared to obtaining a three-month supply through its affiliated mail-order service, thereby limiting patients’ choices.
Earlier this month, the Federal Trade Commission (FTC) released a similar report highlighting the concentration of power among the largest six PBMs, who manage nearly 95% of prescriptions in the U.S. The FTC expressed concern about the substantial influence these PBMs have over access to and affordability of prescription drugs. It noted that this vertical integration raises potential conflicts of interest, as PBMs could preferentially direct patients to their own affiliated businesses, negatively impacting independent pharmacies and driving up costs.
FTC Chair Lina M. Khan stated that the findings indicate these middlemen are “overcharging patients for cancer drugs,” yielding them additional profits exceeding $1 billion.