A recent report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are directing patients towards higher-priced medications while restricting their pharmacy choices.
The committee’s findings were highlighted in the Wall Street Journal following a 32-month investigation ahead of a hearing involving top executives from the nation’s largest PBMs.
PBMs act as intermediaries for prescription drug plans associated with health insurers, negotiating prices with pharmaceutical companies and determining patients’ out-of-pocket expenses. The three dominant PBMs—Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark—control about 80% of U.S. prescriptions.
The report indicates that PBMs have established preferred drug lists featuring more expensive brand-name medications over cheaper alternatives. For instance, the investigation uncovered emails from Cigna discouraging the use of less costly options for Humira, a costly arthritis medication priced at $90,000 annually, despite the availability of biosimilars at about half that cost.
Moreover, Express Scripts reportedly informed patients they would incur higher costs by using local pharmacies instead of obtaining three-month supplies through its affiliated mail-order service, effectively limiting patients’ pharmacy options.
Earlier this month, the U.S. Federal Trade Commission (FTC) released a related report, stating that increasing consolidation within the industry has allowed the six largest PBMs to manage nearly 95% of all U.S. prescriptions.
The FTC expressed concerns about the significant influence PBMs have on Americans’ access to and affordability of prescription medications, noting the potential for conflicts of interest that favor affiliated businesses, potentially disadvantaging independent pharmacies and driving up drug prices. FTC Chair Lina M. Khan commented on the findings, stating that these middlemen are “overcharging patients for cancer drugs” and generating over $1 billion in additional revenue.