A recent report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are directing patients towards more expensive medication options and restricting their pharmacy choices. This report comes ahead of a hearing involving executives from the largest PBMs in the nation and follows a 32-month investigation.
PBMs, which serve as third-party administrators for prescription drug plans, negotiate drug prices with pharmaceutical companies and determine out-of-pocket costs for patients. The three major PBMs—Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark—manage about 80% of U.S. prescriptions.
According to the committee’s findings, PBMs have established preferred drug lists that predominantly feature higher-priced brand-name drugs rather than more affordable alternatives. The report highlights emails from Cigna employees that discouraged the use of lower-cost alternatives to Humira, an expensive treatment for autoimmune conditions priced at $90,000 annually, despite the availability of a biosimilar costing half that amount.
Additionally, Express Scripts reportedly informed patients that they would incur higher costs by filling prescriptions at local pharmacies compared to ordering a three-month supply through their mail-order service, thereby restricting patient choice.
The U.S. Federal Trade Commission (FTC) issued a similar report recently, stating that increased concentration and vertical integration of PBMs has allowed the largest six companies to handle nearly 95% of all prescriptions in the U.S. The FTC noted concerns about the significant influence these leading PBMs have over patients’ access to and affordability of prescription drugs. The commission warned that this system fosters conflicts of interest, as vertically integrated PBMs may prioritize their own associated businesses over unaffiliated pharmacies, leading to increased drug costs.
FTC Chair Lina M. Khan emphasized that these practices have resulted in patients being overcharged for cancer medications, leading to more than $1 billion in additional revenue for these middlemen.