A new report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are directing patients towards more expensive medications while restricting their options for obtaining these drugs. The findings, reported by the Wall Street Journal, come after a thorough 32-month investigation and are set to be discussed in an upcoming hearing featuring executives from major PBMs.
PBMs act as intermediaries that manage prescription drug plans for health insurers, negotiating prices with pharmaceutical companies and determining patients’ out-of-pocket costs. The three largest PBMs in the U.S.—Express Scripts, OptumRx from UnitedHealth Group, and CVS Health’s Caremark—control about 80% of prescriptions in the country.
The committee’s report highlights that PBMs have compiled lists of favored drugs that prominently feature higher-priced brand-name options over more affordable alternatives. One example cited involves communications from Cigna staff discouraging the use of cheaper substitutes for Humira, a medication used to treat arthritis and other autoimmune diseases that has an annual price tag of $90,000, despite the availability of a biosimilar costing significantly less.
Additionally, the report indicates that Express Scripts informed patients that filling a prescription at their local pharmacy would result in higher costs compared to obtaining a three-month supply from its affiliated mail-order service, thereby limiting patient choices.
The Federal Trade Commission (FTC) released a similar report recently, stating that the six largest PBMs dominate nearly 95% of all filled prescriptions in the United States. The FTC raised concerns about the substantial power these entities wield over Americans’ access to affordable medications, noting that the structure creates conflicts of interest that could favor affiliated businesses and lead to increased drug costs.
FTC Chair Lina M. Khan emphasized that these findings illustrate how PBMs are overcharging patients for cancer medications, generating excess revenue exceeding $1 billion.