A recent report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are directing patients towards more costly medications and restricting their options for obtaining them. This report, which resulted from a 32-month investigation, comes ahead of a scheduled hearing featuring executives from major PBM companies.
PBMs serve as third-party administrators for prescription drug plans offered by health insurers. They negotiate medication prices with pharmaceutical firms and determine patients’ out-of-pocket expenses. The three largest PBMs—Express Scripts, OptumRx (part of UnitedHealth Group), and Caremark (owned by CVS Health)—manage about 80% of prescriptions in the U.S.
The committee’s findings suggest that PBMs maintain lists of preferred drugs that prioritize higher-priced brand-name medications over more affordable alternatives. For instance, the report references internal communications from Cigna encouraging the preference for Humira, an arthritis treatment priced at $90,000 annually, despite the availability of a biosimilar option that costs half as much.
Furthermore, the committee discovered that Express Scripts informed patients that filling a prescription at local pharmacies would incur higher costs compared to obtaining a three-month supply from its affiliated mail-order service. This practice effectively limits patients’ choices regarding their pharmacy options.
Earlier this month, the U.S. Federal Trade Commission (FTC) issued a similar report, stating that increased consolidation and vertical integration among PBMs allows the six largest companies to oversee nearly 95% of all prescriptions filled in the country.
The FTC expressed concern over the significant influence PBMs have on Americans’ access to and affordability of prescription drugs, indicating a system in which these entities could favor their own affiliated businesses. This raises potential conflicts of interest that could harm independent pharmacies and elevate prescription costs.
FTC Chair Lina M. Khan highlighted that these middlemen may be overcharging patients for cancer drugs, generating over $1 billion in additional revenue.