A recent report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are directing patients towards more costly medications while restricting their pharmacy choices. This report, which has been reviewed by the Wall Street Journal, is the result of a 32-month investigation and precedes a hearing featuring executives from the largest PBMs in the country.
PBMs act as intermediaries for prescription drug plans, negotiating prices between health plans and pharmaceutical companies and determining out-of-pocket costs for patients. The three biggest PBMs—Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark—manage around 80% of all prescriptions in the U.S.
The committee discovered that PBMs favor higher-priced brand-name drugs in their preferred drug lists, sidelining cheaper alternatives. One highlighted instance involved emails from Cigna that suggested against using biosimilars for Humira, an arthritis treatment that costs approximately $90,000 annually, despite a biosimilar available for half that amount.
Moreover, the report points out that Express Scripts informed patients that filling a prescription at a local pharmacy would be more expensive than obtaining a three-month supply from its affiliated mail-order service, which effectively restricted patients’ choices.
A similar report from the U.S. Federal Trade Commission (FTC) released earlier this month noted that increasing consolidation in the industry has allowed the six largest PBMs to control nearly 95% of all prescriptions filled in the country. The FTC expressed concern over the significant power PBMs wield over patients’ access to affordable prescription drugs and highlighted the potential conflicts of interest that arise when PBMs prioritize their affiliated businesses.
FTC Chair Lina M. Khan remarked that these findings indicate that PBMs are charging patients excessively for cancer treatments, generating over $1 billion in additional revenue as a result.