A recent report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are directing patients toward more costly medications and restricting access to certain pharmacies.
The report, which was examined by the Wall Street Journal, followed a lengthy 32-month investigation by the committee prior to a hearing involving major PBM executives.
PBMs operate as third-party administrators for prescription drug plans provided by health insurers. They negotiate prices with pharmaceutical companies and determine out-of-pocket expenses for patients. The three largest PBMs in the U.S.—Express Scripts, OptumRx (a division of UnitedHealth Group), and Caremark (part of CVS Health)—manage around 80% of the country’s prescriptions.
According to the committee’s findings, PBMs have established lists of preferred medications that include higher-priced brand-name drugs instead of more affordable alternatives. For instance, emails from Cigna highlighted discouragement towards opting for cheaper substitutes for Humira, a treatment for arthritis, which was priced at $90,000 annually, even though a biosimilar option was available for about half that cost.
The report further noted that Express Scripts informed patients they would incur higher charges by filling prescriptions at their local pharmacies compared to obtaining a three-month supply from its affiliated mail-order service. This practice was criticized for limiting patients’ choices regarding where to fill their prescriptions.
Earlier this month, the U.S. Federal Trade Commission (FTC) issued a similar report, indicating that increased consolidation and vertical integration have allowed the six largest PBMs to handle nearly 95% of all U.S. prescriptions.
The FTC expressed concern over the influence these leading PBMs have on Americans’ access to and affordability of prescription medications. Their findings suggest a system where vertically integrated PBMs may favor their own businesses, presenting conflicts of interest that adversely affect independent pharmacies and drive up drug prices. FTC Chair Lina M. Khan noted that these middlemen are “overcharging patients for cancer drugs,” contributing over $1 billion in extra revenue.