Pharmacy benefit managers (PBMs) are directing patients towards costlier medications and restricting options for where these drugs can be obtained, according to a recent report from the House Committee on Oversight and Accountability.
The report, which has been reviewed by the Wall Street Journal, comes after a 32-month investigation by the committee in anticipation of a hearing involving executives from the largest PBMs in the country.
PBMs act as intermediaries in prescription drug plans for health insurance companies, negotiating prices with pharmaceutical manufacturers and determining out-of-pocket costs for patients. The three largest PBMs in the United States—Express Scripts, OptumRx (UnitedHealth Group), and Caremark (CVS Health)—handle around 80% of all prescriptions filled in the country.
The committee’s findings revealed that PBMs have established preferred drug lists that prioritize higher-priced brand name medications over more affordable alternatives. For instance, the report highlighted emails from Cigna staff that discouraged doctors and patients from opting for cheaper alternatives to Humira, a medication for arthritis and other autoimmune disorders, which at the time cost approximately $90,000 annually. There was at least one biosimilar available for about half that price.
Furthermore, the committee noted that Express Scripts informed patients that filling prescriptions at local pharmacies would be more expensive than ordering a three-month supply through their affiliated mail-order service. This practice effectively limited patients’ pharmacy choices.
In a related report released earlier this month, the U.S. Federal Trade Commission (FTC) indicated that increased vertical integration and concentration in the market have enabled the six largest PBMs to control nearly 95% of all prescriptions in the U.S.
The FTC’s findings raise serious concerns. They state that leading PBMs now wield substantial influence over Americans’ access to and affordability of prescription medications. This situation creates a landscape where vertically integrated PBMs may favor their own related businesses, leading to conflicts of interest that can harm independent pharmacies and inflate drug prices.
FTC Chair Lina M. Khan commented that these findings reveal how intermediaries in the pharmaceutical process are “overcharging patients for cancer drugs,” resulting in added revenues of over $1 billion.