A new report from the House Committee on Oversight and Accountability has revealed that pharmacy benefit managers (PBMs) are directing patients toward pricier medications and restricting their pharmacy options.
The report, reviewed by the Wall Street Journal, follows a 32-month investigation by the committee prior to a hearing involving executives from the country’s largest PBMs. These managers, who function as third-party administrators of prescription drug plans for health insurers, negotiate drug 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—together control roughly 80% of the nation’s prescriptions.
According to the findings, PBMs have established preferred drug lists that favor higher-cost brand-name drugs over more affordable alternatives. For instance, the report highlights internal communications from Cigna that discouraged using less expensive alternatives to Humira, a medication for arthritis that was priced at $90,000 per year at the time, despite the existence of a biosimilar option costing half as much.
Moreover, the committee discovered that Express Scripts informed patients they would incur higher costs if they filled prescriptions at local pharmacies instead of through its affiliated mail-order service, thereby limiting patients’ choices in pharmacy selection.
Earlier this month, the U.S. Federal Trade Commission (FTC) released a similar report, stating that increasing consolidation and vertical integration within the pharmacy benefit sector has allowed the six largest PBMs to manage nearly 95% of all prescriptions dispensed in the U.S.
The FTC’s findings are concerning, indicating that leading PBMs hold considerable sway over Americans’ access to affordable medications. This situation has resulted in conflicts of interest that may disadvantage independent pharmacies and inflate drug prices. FTC Chair Lina M. Khan noted that these middlemen have been “overcharging patients for cancer drugs,” generating over $1 billion in additional revenue for themselves.