“Investigating PBMs: Are Prescription Prices Being Manipulated?”

A recent report from the House Committee on Oversight and Accountability highlights that pharmacy-benefit managers (PBMs) are directing patients towards more costly medications and restricting their access to pharmacies. This report, reviewed by the Wall Street Journal, follows a 32-month investigation preceding a hearing that involved executives from the largest PBMs in the country.

PBMs act as intermediaries for prescription drug plans offered by health insurers, negotiating with pharmaceutical companies to determine the costs of medications for health plans and setting out-of-pocket expenses for patients. The three largest 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 developed preferred drug lists that favor higher-priced brand-name drugs over their cheaper counterparts. The report highlights that staff emails from Cigna discouraged the use of more affordable alternatives to Humira, a treatment costing around $90,000 annually, while biosimilars were available for approximately half of that price.

The investigation found that Express Scripts informed patients that they would incur higher costs if they filled prescriptions at local pharmacies compared to obtaining a three-month supply through its affiliated mail-order service, effectively restricting their pharmacy choices.

In a similar report released earlier this month, the U.S. Federal Trade Commission noted that increased vertical integration has allowed the six largest PBMs to manage nearly 95% of all prescriptions in the U.S. The FTC expressed concern that leading PBMs wield considerable influence over Americans’ access to and affordability of prescription drugs, suggesting that this structure prioritizes the PBMs’ affiliated businesses, which can create conflicts of interest and raise drug prices.

FTC Chair Lina M. Khan stated that these findings indicate that PBMs are “overcharging patients for cancer drugs,” resulting in excess revenue exceeding $1 billion.

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