A recent report from the House Committee on Oversight and Accountability has revealed that pharmacy-benefit managers (PBMs) are directing patients towards more costly medications and restricting their pharmacy options. This report, which follows a 32-month investigation, comes ahead of a congressional hearing featuring executives from the largest PBMs in the country.
PBMs serve as intermediaries for prescription drug plans under health insurance, negotiating costs with pharmaceutical companies. They also determine the out-of-pocket expenses for patients. The three biggest PBMs—Express Scripts, OptumRx (part of UnitedHealth Group), and Caremark (owned by CVS Health)—are responsible for managing about 80% of prescriptions in the U.S.
The findings indicate that these PBMs have established preferred drug lists that favor higher-priced brand-name medications instead of cheaper alternatives. An example highlighted in the report involves correspondence from Cigna staff, which discouraged switching to less expensive alternatives for Humira, a medication for arthritis and other autoimmune conditions costing around $90,000 annually, while a biosimilar option was available for half that price.
Additionally, the report noted that Express Scripts informed patients that their costs would be higher if they opted to fill prescriptions at local pharmacies compared to obtaining a three-month supply through their mail-order service. This practice effectively restricts patients’ pharmacy choices.
The U.S. Federal Trade Commission (FTC) also released a report this month that underscores similar concerns. The FTC observed that increased consolidation and vertical integration has led the six largest PBMs to control nearly 95% of all prescriptions in the U.S.
The implications of these findings are concerning. The FTC has stated that major PBMs wield significant influence over Americans’ access to affordable medications, contributing to a scenario where these integrated PBMs may prioritize their own businesses, thereby disadvantaging independent pharmacies and raising drug costs. FTC Chair Lina M. Khan noted that these middlemen might be “overcharging patients for cancer drugs,” resulting in excess revenues exceeding $1 billion.