A new report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are directing patients towards pricier medications while restricting their pharmacy options. This report is the outcome of a 32-month investigation by the committee, coinciding with an upcoming hearing involving executives from the major PBM companies.
PBMs act as intermediaries for prescription drug plans linked to health insurers. They negotiate prices with pharmaceutical companies and establish the out-of-pocket expenses patients must pay. The three largest PBMs in the U.S. – Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark – are responsible for managing about 80% of all U.S. prescriptions.
The committee’s findings indicate that PBMs favor lists of preferred medications that include higher-cost branded drugs instead of less expensive options. Notably, emails from Cigna’s staff suggested patients avoid cheaper alternatives to Humira, an expensive arthritis treatment priced at $90,000 annually, even though a biosimilar was available for half that amount.
Moreover, Express Scripts reportedly informed patients that they would incur higher costs by filling prescriptions at local pharmacies compared to obtaining a three-month supply through their mail-order service. This practice restricts patients’ choices regarding their pharmacy providers.
Recently, the U.S. Federal Trade Commission (FTC) released a similar report, highlighting that the six largest PBMs control nearly 95% of prescriptions filled in the country due to increasing vertical integration and concentration in the industry.
The FTC’s findings raise concerns about the significant influence PBMs have over the affordability and accessibility of prescription medicines for Americans. The report suggests that the vertically integrated structure of PBMs might create conflicts of interest, disadvantaging independent pharmacies and driving up drug prices. FTC Chair Lina M. Khan emphasized that these middlemen could be overcharging patients for critical cancer medications, resulting in additional revenue exceeding $1 billion.