A recent 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 pharmacy options. This report follows a 32-month investigation, leading up to an upcoming hearing featuring executives from the country’s largest PBMs.
PBMs serve as third-party administrators for health insurers’ prescription drug plans, negotiating with pharmaceutical companies on drug pricing and establishing out-of-pocket costs for patients. The three largest PBMs in the United States—Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark—manage around 80% of the nation’s prescriptions.
According to the committee’s findings, PBMs are maintaining preferred drug lists that prioritize higher-priced brand-name medications over more affordable alternatives. An example highlighted in the report involved Cigna staff discouraging the use of cheaper substitutes for Humira, an expensive treatment for arthritis and autoimmune conditions, which costs approximately $90,000 annually, despite the availability of a biosimilar at half that price.
Furthermore, the investigation revealed that Express Scripts informed patients they would face greater expenses by filling prescriptions at their local pharmacies compared to using their affiliated mail-order service, thus limiting patients’ choices.
Earlier this month, the U.S. Federal Trade Commission (FTC) released a report echoing these concerns, indicating that the six largest PBMs now control nearly 95% of prescriptions in the U.S. The FTC described this concentration of power as problematic, indicating that leading PBMs significantly influence Americans’ access to affordable prescription medications. The report also pointed to potential conflicts of interest, as vertically integrated PBMs may favor their affiliated businesses over independent pharmacies, which could drive up drug costs.
FTC Chair Lina M. Khan emphasized that the findings suggest these intermediaries are overcharging patients for critical medications, with an excess revenue of over $1 billion attributed to this practice.