Pharmacy-benefit managers (PBMs) are directing patients towards more expensive medications while restricting their options for obtaining these drugs, according to a recent report from the House Committee on Oversight and Accountability.
The report, which was accessed by the Wall Street Journal, is the result of a 32-month investigation by the committee and precedes a hearing on PBMs involving executives from the largest companies in the field.
PBMs are intermediaries that administer prescription drug plans for health insurers, negotiating with pharmaceutical firms over the costs health plans will incur for medications. They also determine patients’ out-of-pocket expenses.
The three largest PBMs in the United States—Express Scripts, OptumRx (a subsidiary of UnitedHealth Group), and CVS Health’s Caremark—manage around 80% of all prescriptions filled in the country.
The committee’s findings suggest that PBMs have developed preferred drug lists featuring higher-priced brand-name drugs instead of more affordable alternatives. For example, the report references emails from Cigna employees that discouraged the use of a less expensive option for Humira, a medication for arthritis and other autoimmune disorders, which had a cost of $90,000 per year at that time, with at least one biosimilar available for about half that price.
In addition, Express Scripts allegedly informed patients that filling a prescription at their local pharmacy would be costlier than obtaining a three-month supply from its affiliated mail-order pharmacy, significantly limiting patients’ pharmacy choices.
Earlier this month, the U.S. Federal Trade Commission (FTC) released a similar report, stating that the growing vertical integration and consolidation in the sector has allowed the six largest PBMs to control nearly 95% of all prescriptions filled in the U.S.
These findings are concerning. The FTC noted that “the dominant PBMs now wield considerable power over Americans’ access to and affordability of their prescription medications.” The situation fosters a system where “vertically integrated PBMs seem to possess both the capability and motivation to favor their own affiliated entities, which can harm independent pharmacies and elevate drug costs.”
FTC Chair Lina M. Khan pointed out that the data indicates that these intermediaries are “overcharging patients for cancer treatments,” generating an additional revenue exceeding $1 billion.