Pharmacy benefit managers (PBMs) are directing patients towards higher-priced medications and restricting their pharmacy options, according to a recent report from the House Committee on Oversight and Accountability.
The report, which followed a 32-month investigation, was shared before an upcoming hearing featuring executives from the largest PBMs in the country.
PBMs, which serve as third-party administrators for prescription drug plans, negotiate pricing with drug manufacturers on behalf of health insurers. They also determine the out-of-pocket expenses that patients must pay.
Express Scripts, OptumRx (part of UnitedHealth Group), and Caremark (owned by CVS Health) together manage around 80% of prescription fills in the U.S.
The committee’s findings indicate that PBMs are developing preferred drug lists that favor costlier brand-name medications over more affordable alternatives. For instance, the report references emails from Cigna employees advising against the use of cheaper substitutes for Humira, a treatment for arthritis and other autoimmune disorders that had a price tag of $90,000 annually, while at least one biosimilar was offered at half that price.
Additionally, the committee discovered that Express Scripts informed patients that they would incur higher costs by filling their prescriptions at local pharmacies compared to obtaining a three-month supply through their affiliated mail-order service. This practice restricts patients’ choice of pharmacy.
Earlier this month, the U.S. Federal Trade Commission (FTC) released a similar report, stating that increased vertical integration among PBMs has allowed the six largest managers to oversee nearly 95% of U.S. prescription fills.
The implications are concerning. The FTC report noted that leading PBMs now possess significant influence over Americans’ access to and affordability of prescription drugs. This situation fosters a climate in which integrated PBMs may prefer their own affiliated businesses, leading to conflicts of interest that could harm independent pharmacies and inflate drug costs.
FTC Chair Lina M. Khan stated that these findings reveal how intermediaries are “overcharging patients for cancer drugs,” generating over $1 billion in extra revenue.