A recent report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are directing patients toward more expensive medications and restricting the options available for obtaining them.
The report, which followed a 32-month investigation and was reviewed by the Wall Street Journal, precedes a forthcoming hearing featuring executives from the largest PBMs in the U.S.
PBMs act as intermediaries who manage prescription drug plans for health insurers, negotiating pricing with drug manufacturers and determining out-of-pocket costs for consumers. The three largest PBMs—Express Scripts, OptumRx (part of UnitedHealth Group), and Caremark (a division of CVS Health)—control around 80% of prescriptions in the country.
According to the committee’s findings, these PBMs frequently compile lists of preferred medications that prioritize higher-priced brand-name drugs over more affordable alternatives. For instance, the report highlights communications from Cigna staff discouraging the use of cheaper options for Humira, an arthritis treatment priced at $90,000 annually, while less expensive biosimilars were available at about half that cost.
Additionally, it was noted that Express Scripts informed patients they would incur higher costs by filling prescriptions at local pharmacies compared to ordering a three-month supply through its affiliated mail-order service, thereby limiting patients’ pharmacy choices.
Earlier this month, the U.S. Federal Trade Commission (FTC) released a similar report, stating that the increasing consolidation among PBMs has allowed the six largest firms to control nearly 95% of prescriptions filled in the U.S. The FTC’s interim report raised concerns about significant power these PBMs wield over the accessibility and affordability of prescription medications.
The FTC emphasized that this dominance creates a scenario where vertically integrated PBMs have both the capability and motive to favor their own affiliated entities, potentially harming independent pharmacies and driving up drug costs. FTC Chair Lina M. Khan noted that these middlemen are allegedly “overcharging patients for cancer drugs,” leading to more than $1 billion in additional revenue for them.