A new report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are directing patients towards more costly medications while restricting their options for obtaining these prescriptions. The investigation, which lasted 32 months, precedes a hearing involving executives from the country’s leading PBMs.
According to the report, Medicare patients could potentially save up to $1.5 billion on 10 prescription drugs. PBMs serve as intermediaries for prescription drug plans provided by health insurers, negotiating prices with pharmaceutical companies and determining the out-of-pocket costs that patients must pay.
The three largest PBMs in the United States—Express Scripts, OptumRx, and CVS Health’s Caremark—control around 80% of all prescriptions filled in the country. The committee’s findings indicate that these PBMs have established lists of preferred medications that prioritize higher-priced brand-name drugs over more affordable generic alternatives. For instance, emails from Cigna staff discouraged the use of lower-cost alternatives to Humira, a treatment that was priced at $90,000 annually, despite the availability of a biosimilar for half that cost.
Additionally, the report noted that Express Scripts informed patients that purchasing a three-month supply from their affiliated mail-order pharmacy would be more economical than filling a prescription at a local pharmacy, effectively limiting the choices available to patients.
A similar analysis released by the U.S. Federal Trade Commission (FTC) highlighted the increasing concentration of power among PBMs, noting that the largest six PBMs account for nearly 95 percent of all prescriptions in the U.S. The FTC’s interim report raised concerns about the potential conflicts of interest arising from vertically integrated PBMs, which may favor their own affiliated businesses while disadvantaging independent pharmacies and driving up drug prices.
FTC Chair Lina M. Khan emphasized that these findings indicate that PBMs have been overcharging patients for cancer medications, generating over $1 billion in excess revenue.