A recent report from the House Committee on Oversight and Accountability has revealed that pharmacy-benefit managers (PBMs) are directing patients toward more costly medications and restricting their pharmacy options. This report follows a comprehensive 32-month investigation, conducted prior to a committee hearing involving leaders from the country’s largest PBMs.
PBMs serve as intermediaries in managing prescription drug plans for health insurers, negotiating pricing with pharmaceutical companies and determining out-of-pocket costs for patients. The three largest PBMs in the U.S. – Express Scripts, OptumRx (owned by UnitedHealth Group), and CVS Health’s Caremark – control nearly 80% of prescription drug transactions.
The report indicates that these PBMs maintain lists of preferred medications that often showcase higher-priced brand-name drugs instead of more affordable alternatives. An example highlighted in the findings includes internal communications from Cigna that dissuaded employees from suggesting lower-cost options for Humira, a drug used for arthritis and other autoimmune diseases that can cost $90,000 annually, despite the availability of a biosimilar at half the price.
Additionally, the committee discovered that Express Scripts informed patients they would incur higher costs by using their local pharmacy rather than obtaining a three-month supply through their affiliated mail-order service, thereby restricting patient choice in pharmacy selection.
The U.S. Federal Trade Commission (FTC) released a similar report earlier in the month, noting that rising concentration and vertical integration have granted the six largest PBMs control over nearly 95% of prescriptions in the U.S. The FTC’s interim findings express concern over the significant influence PBMs have on Americans’ access to affordable medications, suggesting that their operations may favor affiliated businesses and raise drug prices across the board.
FTC Chair Lina M. Khan emphasized that these findings indicate that PBMs are overcharging patients for cancer medications, leading to excess profits exceeding $1 billion.