Pharmacy-benefit managers (PBMs) are directing patients towards more expensive medications while restricting their options for obtaining them, according to a recent report from the House Committee on Oversight and Accountability.
This report, obtained by the Wall Street Journal, stems from a 32-month investigation and comes ahead of a hearing on PBMs, which will feature executives from the country’s largest PBM firms.
PBMs serve as intermediaries managing prescription drug plans for health insurers. They negotiate with drug manufacturers on pricing and also determine the out-of-pocket expenses that patients incur.
The three largest PBMs in the U.S., Express Scripts, OptumRx (part of UnitedHealth Group), and Caremark (operated by CVS Health), collectively manage about 80% of U.S. prescriptions.
The committee’s investigation revealed that PBMs have compiled preferred drug lists that prioritize higher-priced branded drugs over more affordable alternatives. For instance, the report highlighted internal communications from Cigna that discouraged prescribing cheaper options for Humira, a medication for arthritis and other autoimmune diseases that costs $90,000 annually, despite a biosimilar available at half that cost.
Additionally, the report indicated that Express Scripts informed patients they would incur higher costs by filling prescriptions at local pharmacies compared to obtaining a three-month supply through their mail-order service. This practice seemingly limits patients’ choices regarding pharmacy selection.
Earlier this month, the U.S. Federal Trade Commission (FTC) released a similar report, noting that increased vertical integration allows the six largest PBMs to manage nearly 95% of all prescriptions filled in the United States.
These findings raise significant concerns. The FTC stated that leading PBMs wield substantial influence over Americans’ access to and affordability of prescription medications. This situation leads to potential conflicts of interest, as vertically integrated PBMs may favor their own affiliated businesses, which may marginalize independent pharmacies and escalate drug costs.
According to FTC Chair Lina M. Khan, the report indicates that these intermediaries are “overcharging patients for cancer drugs,” generating over $1 billion in additional revenue.