A new report from the House Committee on Oversight and Accountability claims that pharmacy-benefit managers (PBMs) are directing patients toward costlier medications while restricting their pharmacy options. The report, which emerged ahead of a hearing on PBMs featuring top executives from major firms, followed a thorough 32-month investigation.
PBMs function as third-party administrators for prescription drug plans, negotiating prices with pharmaceutical companies and determining patients’ out-of-pocket expenses. The three largest PBMs in the U.S., Express Scripts, OptumRx from UnitedHealth Group, and Caremark from CVS Health, control about 80% of all prescriptions filled.
The committee’s findings suggest that PBMs curate lists of preferred medications that favor higher-priced brand-name drugs over more affordable alternatives. For instance, emails from Cigna were cited, discouraging the use of less expensive options to Humira, a treatment for arthritis and other autoimmune diseases, which at the time had an annual cost of $90,000, despite the availability of a biosimilar for half that price.
Additionally, the report indicated that Express Scripts informed patients they would incur higher costs by filling prescriptions at local pharmacies instead of utilizing its affiliated mail-order service, effectively limiting patient choice in pharmacy selection.
In a related study, the U.S. Federal Trade Commission recently revealed that the six largest PBMs now manage nearly 95% of all filled prescriptions in the country, raising concerns about the power they wield over drug access and costs. The FTC’s Chair, Lina M. Khan, noted that this vertical integration results in PBMs potentially favoring their own associated businesses, which creates conflicts of interest and escalates prescription costs. Furthermore, it was reported that these intermediaries are profiting significantly, overcharging patients for cancer medications and generating more than $1 billion in additional revenue.