Pharmacy-benefit managers (PBMs) are reportedly guiding patients toward costlier medications while restricting their pharmacy options, according to a recent report by the House Committee on Oversight and Accountability.
The report, which was reviewed by the Wall Street Journal, stemmed from a 32-month investigation conducted by the committee prior to a hearing featuring executives from the nation’s largest PBMs.
PBMs serve as third-party administrators for prescription drug plans on behalf of health insurers. They negotiate prices with pharmaceutical companies and determine patients’ out-of-pocket expenses. Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark collectively manage around 80% of prescriptions filled in the United States.
Findings from the committee’s report indicate that PBMs have established preferred drug lists favoring higher-priced brand-name medications over more affordable options. An example highlighted in the report details emails from staff at Cigna that allegedly discouraged patients from using cheaper alternatives to Humira, a drug for arthritis and other autoimmune conditions, which was priced at $90,000 annually at the time, despite the availability of a biosimilar option costing half that.
Additionally, the committee discovered that Express Scripts informed patients they would incur higher costs if they filled prescriptions at local pharmacies compared to ordering a three-month supply from its affiliated mail-order service, thus limiting patient choices.
Earlier this month, the U.S. Federal Trade Commission (FTC) released a similar report indicating that escalating vertical integration and concentration among PBMs has allowed the six largest firms to now oversee nearly 95% of all prescriptions in the U.S.
The implications are concerning. The FTC noted that “the leading PBMs now exercise significant power over Americans’ ability to access and afford their prescription drugs.” This dynamic appears to foster an environment where vertically integrated PBMs may favor their own affiliated entities, potentially disadvantaging independent pharmacies and driving up drug prices.
FTC Chair Lina M. Khan stated that these findings indicate that PBMs are “overcharging patients for cancer drugs,” resulting in an added revenue exceeding $1 billion.