Pharmacy benefit managers (PBMs) are directing patients towards costlier medications and restricting their options on where to obtain them, a recent report from the House Committee on Oversight and Accountability reveals.
The report, which stemmed from a 32-month investigation, is particularly timely as it precedes a hearing involving executives from the largest PBMs in the country. These third-party administrators manage prescription drug plans for health insurers and negotiate pricing with pharmaceutical companies, effectively determining both the costs for health plans and out-of-pocket expenses for patients.
The country’s three biggest PBMs—Express Scripts, OptumRx (under UnitedHealth Group), and CVS Health’s Caremark—account for approximately 80% of U.S. prescriptions.
The committee’s findings indicate that PBMs have established lists of preferred drugs filled with high-priced brand-name options instead of more affordable alternatives. An example highlighted in the report is from Cigna, where staff discouraged the use of cheaper substitutes for Humira, a medication for arthritis and other autoimmune conditions that costs around $90,000 annually, even though a biosimilar was available for roughly half that price.
Additionally, Express Scripts informed patients that filling prescriptions at local pharmacies would be more expensive than acquiring a three-month supply through its affiliated mail-order service. This practice restricts patients’ choices regarding where to fill their prescriptions.
Earlier this month, the U.S. Federal Trade Commission (FTC) released a similar report, noting that rising vertical integration and market concentration have allowed the six largest PBMs to control nearly 95% of all filled prescriptions in the United States.
The FTC highlighted the adverse implications, stating, “The leading PBMs now exercise significant power over Americans’ ability to access and afford their prescription drugs.” It also pointed out that the structure enables PBMs to favor their own associated businesses, leading to conflicts of interest that can harm independent pharmacies and elevate drug prices.
FTC Chair Lina M. Khan remarked that the findings demonstrate how these intermediaries may be “overcharging patients for cancer drugs,” resulting in an additional revenue stream exceeding $1 billion.