A new report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are directing patients toward more expensive medications and restricting access to certain pharmacies. This report, reviewed by the Wall Street Journal, is the result of a 32-month investigation that precedes a hearing on PBMs involving executives from the largest management firms in the country.
PBMs serve as intermediaries for prescription drug plans offered by health insurers, negotiating prices with pharmaceutical companies on behalf of health plans while also determining patients’ out-of-pocket expenses. The three largest PBMs—Express Scripts, OptumRx (owned by UnitedHealth Group), and Caremark (owned by CVS Health)—collectively manage about 80% of prescriptions filled in the U.S.
According to the committee’s findings, PBMs have developed lists of preferred drugs that favor high-priced brand-name medications over more affordable alternatives. The report highlights communication from Cigna staff who discouraged the use of cheaper options for Humira, an arthritis treatment that cost $90,000 annually, despite the availability of a biosimilar for half the price.
Additionally, Express Scripts has informed patients that they would incur higher costs if they chose to fill prescriptions at their local pharmacies instead of utilizing its associated mail-order pharmacy, thereby limiting patients’ pharmacy options.
Earlier this month, the U.S. Federal Trade Commission released a report indicating that increasing consolidation and vertical integration has allowed the six largest PBMs to control nearly 95% of all prescriptions dispensed in the U.S. The FTC expressed concern over the power this gives PBMs in terms of access to and affordability of prescription medications, noting that the system creates conflicts of interest that can disadvantage independent pharmacies and raise drug costs.
FTC Chair Lina M. Khan commented that these findings indicate that PBMs are “overcharging patients for cancer drugs,” generating over $1 billion in additional revenue.