A recent report from the House Committee on Oversight and Accountability indicates that pharmacy-benefit managers (PBMs) are directing patients toward more costly medications and restricting pharmacy options. The findings, revealed to the Wall Street Journal, stem from a 32-month investigation that coincided with an upcoming hearing featuring executives from the nation’s largest PBMs.
PBMs act as intermediaries for health insurers, managing prescription drug plans. They negotiate prices with pharmaceutical companies and determine out-of-pocket costs for patients. The three largest PBMs—Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark—account for nearly 80% of U.S. prescriptions.
The committee’s report highlighted that PBMs often favor higher-priced brand-name drugs over less expensive alternatives. An example noted in the report included internal communications from Cigna, which discouraged the use of more affordable substitutes for the arthritis treatment Humira, priced at $90,000 annually despite the availability of a biosimilar costing half that amount.
Moreover, the investigation revealed that Express Scripts informed patients they would incur higher costs by filling prescriptions at local pharmacies compared to obtaining a three-month supply from their affiliated mail-order service. This practice effectively limited patients’ pharmacy choices.
A similar report from the U.S. Federal Trade Commission (FTC) released earlier this month stated that the six largest PBMs now control almost 95% of all prescriptions filled in the United States. The FTC’s interim report expressed concern over the considerable power these leading PBMs have over access to and affordability of prescription drugs. They indicated that vertically integrated PBMs may favor their own businesses, leading to conflicts of interest that disadvantage independent pharmacies and inflate drug costs.
FTC Chair Lina M. Khan noted that these findings illustrate how middlemen are reportedly overcharging patients for cancer medications, generating more than $1 billion in additional revenue.