A recent report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are guiding patients towards more costly medications and restricting their options for obtaining them. This report follows a 32-month investigation by the committee prior to a scheduled hearing involving executives from the leading PBMs in the country.
As third-party administrators for health insurers’ prescription drug plans, PBMs negotiate prices with pharmaceutical companies and determine patients’ out-of-pocket costs. The three largest PBMs in the U.S.—Express Scripts, OptumRx from UnitedHealth Group, and Caremark from CVS Health—control approximately 80% of all prescriptions.
The committee’s findings indicate that PBMs maintain lists of preferred medications that prioritize higher-priced brand-name drugs over cheaper alternatives. For instance, emails from Cigna revealed discouragement of cost-effective alternatives to Humira, an arthritis treatment that at one point cost $90,000 annually, despite the availability of a biosimilar at half that price.
Additionally, Express Scripts informed patients that they would incur higher costs for prescriptions filled at local pharmacies compared to obtaining a three-month supply through its associated mail-order service, significantly limiting patient pharmacy choices.
Earlier this month, the U.S. Federal Trade Commission (FTC) issued a similar report asserting that increasing concentration and vertical integration have allowed the six largest PBMs to control nearly 95% of all prescriptions filled in the United States. The FTC’s findings highlight concerns regarding the power these leading PBMs hold over patients’ access to and costs for prescription medications. The report suggests that the interests of vertically integrated PBMs could lead to preferential treatment for their own affiliated companies, creating conflicts that disadvantage independent pharmacies and drive up drug costs.
FTC Chair Lina M. Khan emphasized that these intermediaries are “overcharging patients for cancer drugs,” adding over $1 billion to their revenues.