A recent report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are directing patients towards higher-priced medications while restricting their pharmacy options. The findings, which followed a 32-month investigation and were reviewed by the Wall Street Journal, shed light on the role of PBMs and precede a hearing with executives from major PBMs.
PBMs serve as intermediaries for prescription drug plans offered by health insurers, negotiating drug prices and determining patient out-of-pocket expenses. The three largest PBMs—Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark—control about 80% of all U.S. prescriptions.
The committee’s report indicates that PBMs have been favoring preferred drug lists that prioritize more expensive brand-name medications over cheaper alternatives. Specifically, it highlights communications from Cigna employees that discouraged using lower-cost alternatives to Humira, a costly drug for arthritis and other autoimmune conditions priced at $90,000 annually, despite the availability of biosimilars at half that cost.
Additionally, Express Scripts allegedly informed patients they would incur higher costs by filling prescriptions at local pharmacies compared to obtaining a three-month supply through its own mail-order service, thereby restricting patient pharmacy choices.
The U.S. Federal Trade Commission (FTC) released a similar report earlier this month, noting that the top six PBMs manage nearly 95% of prescriptions filled nationwide. The FTC report raised concerns regarding the considerable influence PBMs have over access to affordable medications. It highlighted a potential conflict of interest, where vertically integrated PBMs may favor their affiliated businesses, leading to higher drug costs for patients and disadvantaging independent pharmacies.
FTC Chair Lina M. Khan emphasized that these middlemen are overcharging patients for essential medications, particularly cancer drugs, and generating over $1 billion in additional revenue as a result.