According to a recent report from the House Committee on Oversight and Accountability, pharmacy-benefit managers (PBMs) are directing patients towards more expensive medications while restricting their pharmacy options. This report follows a 32-month investigation and precedes an upcoming hearing featuring executives from the country’s largest PBMs.
PBMs act as intermediaries for prescription drug plans created by health insurers, negotiating prices with pharmaceutical companies and determining the out-of-pocket costs patients face. The three largest PBMs—CVS Health’s Caremark, UnitedHealth Group’s OptumRx, and Express Scripts—handle around 80% of prescriptions in the U.S.
The committee’s findings indicate that PBMs compile lists of preferred medications that often include costly brand-name drugs instead of lower-cost alternatives. For instance, the report references internal communications from Cigna discouraging the use of more affordable substitutes for Humira, an arthritis medication priced at $90,000 annually, despite the existence of a biosimilar at half that cost.
Additionally, Express Scripts reportedly informed patients that they would incur higher costs by using local pharmacies compared to obtaining a three-month supply through its mail-order service, thereby restricting patient pharmacy choices.
Earlier this month, the U.S. Federal Trade Commission (FTC) released a similar report stating that increasing consolidation among PBMs has allowed the six largest to control nearly 95% of all prescriptions in the United States. The FTC expressed concern over the significant influence PBMs have on patients’ access to affordable medications, warning of conflicts of interest as integrated PBMs may prioritize their own businesses over unaffiliated pharmacies, ultimately driving up drug costs.
FTC Chair Lina M. Khan emphasized that these findings suggest that PBMs are “overcharging patients for cancer drugs,” which has resulted in an excess revenue of over $1 billion for these middlemen.