A recent report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are directing patients towards pricier medications while restricting their options for obtaining them. The findings, reported by the Wall Street Journal, stem from a 32-month investigation conducted prior to a hearing featuring executives from the largest PBMs in the country.
PBMs function as intermediaries in administering prescription drug plans for health insurers, negotiating prices with pharmaceutical companies and determining out-of-pocket costs for patients. The three largest PBMs in the U.S.—Express Scripts, OptumRx (part of UnitedHealth Group), and Caremark (part of CVS Health)—control about 80% of prescriptions across the country.
The committee’s findings indicate that PBMs are favoring higher-priced brand-name drugs over more affordable alternatives. For instance, emails from Cigna revealed an effort to discourage patients from opting for cheaper alternatives to Humira, a treatment for arthritis and other autoimmune disorders, which costs $90,000 annually, despite the availability of a biosimilar at half that price.
Additionally, Express Scripts allegedly informed patients that they would incur higher costs by having prescriptions filled at local pharmacies compared to obtaining a three-month supply from its affiliated mail-order service, effectively limiting patient choice.
Earlier in the month, the U.S. Federal Trade Commission (FTC) released a similar report, highlighting that the six largest PBMs manage nearly 95% of all U.S. prescriptions. The FTC expressed concern regarding the substantial power PBMs wield over Americans’ access to and affordability of prescription medications. It pointed out that the current structure creates potential conflicts of interest, as vertically integrated PBMs may favor their own affiliated businesses, disadvantaging independent pharmacies and escalating drug prices.
FTC Chair Lina M. Khan emphasized that these findings suggest that PBMs are overcharging patients for cancer medications, generating over $1 billion in additional revenue as a result.