A recent report from the House Committee on Oversight and Accountability has revealed that pharmacy-benefit managers (PBMs) are guiding patients toward pricier medications while restricting their pharmacy choices. The findings, which were examined by the Wall Street Journal, come after a comprehensive 32-month investigation by the committee in anticipation of a hearing featuring top executives from the largest PBMs in the country.
PBMs serve as intermediaries for prescription drug plans for health insurers, negotiating prices with pharmaceutical firms and determining patients’ out-of-pocket costs. The three largest PBMs in the U.S.—Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark—control around 80% of all prescriptions dispensed in the country.
The committee’s findings indicate that these PBMs have established preferred drug lists that favor higher-priced brand-name medications over more economical alternatives. An example highlighted in the report includes internal communications from Cigna discouraging the use of less expensive substitutes for Humira, a drug for arthritis and other autoimmune disorders that costs about $90,000 annually, despite the availability of a biosimilar at half that price.
Furthermore, the committee discovered that Express Scripts informed patients that they would incur higher costs when using their local pharmacy compared to obtaining a three-month supply through its affiliated mail-order service, effectively limiting their pharmacy options.
A similar report released earlier this month by the U.S. Federal Trade Commission (FTC) indicated that increased consolidation among PBMs has led to the six largest firms managing nearly 95% of all prescriptions in the U.S. The FTC expressed concern, stating that “the leading PBMs now exercise significant power over Americans’ ability to access and afford their prescription drugs,” as well as creating a system that favors their own affiliated businesses, leading to conflicts of interest and higher overall drug costs.
FTC Chair Lina M. Khan emphasized that these findings illustrate how PBMs are overcharging patients for cancer drugs, generating an additional revenue of over $1 billion.