Pharmacy-benefit managers (PBMs) are reportedly directing patients towards higher-cost medications while restricting their options for obtaining these drugs, as highlighted in a recent report by the House Committee on Oversight and Accountability.
This report, which was reviewed by the Wall Street Journal, followed a thorough 32-month investigation by the committee in anticipation of a hearing that will feature executives from the largest PBMs in the country.
PBMs serve as intermediaries managing prescription drug plans for health insurers. Their responsibilities include negotiating prices with pharmaceutical companies for medications and determining what patients will pay out-of-pocket.
The three largest PBMs in the United States—Express Scripts, OptumRx (owned by UnitedHealth Group), and Caremark (part of CVS Health)—handle around 80% of prescriptions filled nationwide.
The committee’s findings revealed that PBMs have established preferred drug lists that favor more expensive brand-name medications over less costly alternatives. For instance, the report mentions communications from Cigna employees that discouraged the use of lower-priced options for Humira, a drug for arthritis and other autoimmune disorders, which was priced at $90,000 annually at the time, despite the existence of a biosimilar costing about half that.
Additionally, the report indicated that Express Scripts informed patients they would incur higher costs by using their local pharmacy compared to obtaining a three-month supply through its affiliated mail-order service. This practice effectively limited patients’ choices regarding pharmacy options.
Earlier this month, the U.S. Federal Trade Commission (FTC) released a report echoing similar concerns. The FTC stated that increasing vertical integration among the largest PBMs has allowed these six entities to oversee nearly 95% of all prescriptions in the U.S.
The implications of these findings raise significant concerns. According to the FTC, the leading PBMs now wield substantial influence over Americans’ access to and affordability of prescription drugs. This creates a framework where “vertically integrated PBMs seem to have the capacity and motivation to favor their own affiliated businesses, resulting in conflicts of interest that can harm independent pharmacies and escalate prescription drug prices.”
FTC Chair Lina M. Khan emphasized that the revelations indicate these intermediaries are “overcharging patients for cancer drugs,” which has led to an additional revenue stream exceeding $1 billion.