A recent report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are directing patients towards pricier medications and limiting their options for where to obtain these drugs. This report follows a 32-month investigation and comes in advance of a hearing involving executives from the leading PBM companies in the U.S.
PBMs function as intermediaries for prescription drug plans on behalf of health insurers, negotiating prices with drug manufacturers and determining patients’ out-of-pocket expenses. The three largest PBMs in the United States—Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark—manage about 80% of all U.S. prescriptions.
The report highlights that PBMs have established lists of preferred medications that favor more expensive brand-name drugs over affordable alternatives. An example cited in the report involves emails from Cigna employees that discouraged the use of less costly options for Humira, a popular arthritis treatment priced at around $90,000 annually, despite the availability of a biosimilar costing half that amount.
Moreover, findings indicate that Express Scripts advised patients that they could expect to pay more at local pharmacies compared to obtaining a three-month supply through its mail-order service, effectively limiting patients’ pharmacy choices.
This report comes on the heels of a similar assessment released by the U.S. Federal Trade Commission (FTC), which noted that the increasing consolidation in the PBM sector has allowed the top six PBMs to manage nearly 95% of all prescriptions in the country. The FTC expressed concerns about the significant power these entities hold over Americans’ access to affordable medications, suggesting that the vertically integrated PBMs may prioritize their own businesses, leading to conflicts of interest that disadvantage independent pharmacies and elevate drug costs.
FTC Chair Lina M. Khan underscored alarming findings, indicating that these intermediaries may be overcharging patients for critical medications, including cancer treatments, resulting in over $1 billion in additional revenue for them.