According to a recent report from the House Committee on Oversight and Accountability, pharmacy-benefit managers (PBMs) are directing patients towards more expensive medications while restricting their pharmacy options. This report, which followed a thorough 32-month investigation, was reviewed by the Wall Street Journal and comes in advance of an upcoming hearing involving leaders from the largest PBMs in the country.
PBMs act as intermediaries for health insurers, managing prescription drug plans. They negotiate prices with pharmaceutical companies and determine the out-of-pocket expenses for patients. The three largest PBMs in the U.S.—Express Scripts, OptumRx (UnitedHealth Group), and Caremark (CVS Health)—handle roughly 80% of all prescriptions in the country.
The committee’s findings indicated that PBMs tend to favor higher-priced brand-name medications over more affordable alternatives. For instance, the report referenced internal communications from Cigna that discouraged using cheaper substitutes for Humira, a medication for arthritis and other autoimmune issues that was priced at $90,000 annually, despite the availability of a biosimilar costing half as much.
Moreover, the committee found instances where Express Scripts informed patients that purchasing a prescription from their local pharmacy would be more expensive than obtaining a three-month supply through their affiliated mail-order service, thus restricting patients’ choices regarding where to fill their prescriptions.
Earlier this month, the U.S. Federal Trade Commission (FTC) published a similar report highlighting the increasing consolidation of the industry, noting that the six largest PBMs now oversee nearly 95% of all prescriptions filled in the U.S. The FTC expressed concern over the significant power the leading PBMs hold over patients’ access to affordable medications, raising the possibility of conflicts of interest that could harm independent pharmacies and drive up drug costs.
FTC Chair Lina M. Khan pointed out that these middlemen are reportedly overcharging patients for cancer treatments, resulting in an additional $1 billion in revenue for themselves.