A recent report from the House Committee on Oversight and Accountability highlights concerns over pharmacy-benefit managers (PBMs) directing patients towards more costly medications and restricting their options for obtaining them. This report follows a 32-month investigation and precedes a hearing involving executives from the country’s largest PBMs.
PBMs act as intermediaries for prescription drug plans offered by health insurers, negotiating prices with pharmaceutical companies and determining patients’ out-of-pocket costs. The three largest PBMs in the United States – Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark – manage about 80% of prescriptions.
The committee’s findings indicate that these PBMs often maintain preferred drug lists that favor higher-priced brand-name medications over more affordable alternatives. An example cited in the report involves emails from Cigna staff discouraging the use of cheaper alternatives to Humira, a costly treatment for arthritis priced at $90,000 annually, when a biosimilar was available for half the cost.
Additionally, the committee revealed that Express Scripts informed patients they would pay more if they filled prescriptions at local pharmacies compared to obtaining a three-month supply from its affiliated mail-order pharmacy, effectively limiting patients’ pharmacy choices.
Earlier this month, the U.S. Federal Trade Commission (FTC) released a similar report, noting that increased consolidation in the industry has led the six largest PBMs to manage nearly 95% of all prescriptions in the U.S. This situation raises significant concerns, as highlighted by the FTC, which stated that leading PBMs possess considerable power over Americans’ access to and affordability of prescription medications. The report also pointed out potential conflicts of interest where vertically integrated PBMs may favor their own affiliated businesses, ultimately disadvantaging independent pharmacies and raising drug prices.
FTC Chair Lina M. Khan emphasized that these intermediaries are inflating costs for patients, particularly for cancer medications, generating over $1 billion in additional revenue.