A recent report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are directing patients towards pricier medications while restricting their choice of pharmacies. This investigation, which lasted 32 months, precedes a hearing involving executives from the country’s largest PBMs.
PBMs serve as third-party administrators of prescription drug plans for health insurers, negotiating prices with drug manufacturers and establishing out-of-pocket costs for patients. The three largest PBMs—Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark—manage about 80% of prescriptions in the United States.
According to the report, PBMs are promoting lists of preferred medications that often feature more expensive brand-name drugs rather than more affordable alternatives. For instance, the report highlights communications from Cigna’s staff that dissuaded the use of less costly options for Humira, a treatment for arthritis, which was priced at $90,000 annually while a biosimilar was available for roughly half that amount.
Additionally, the committee found that Express Scripts advised patients they would incur higher costs at local pharmacies compared to obtaining a three-month supply through its affiliated mail-order service, thus restricting patient choices.
Earlier this month, the U.S. Federal Trade Commission (FTC) issued a similar report, noting that the increasing concentration and vertical integration in the industry has allowed the six largest PBMs to control nearly 95% of all U.S. prescriptions. The FTC’s findings raised concerns about the substantial influence these leading PBMs have over patients’ access to affordable medications and indicated that such firms may favor their own businesses, creating conflicts of interest and driving up drug prices.
FTC Chair Lina M. Khan commented that these findings indicate that PBMs are “overcharging patients for cancer drugs,” generating additional revenue exceeding $1 billion.