A recent report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are directing patients towards costlier medications while restricting their pharmacy options.
The findings, reported by the Wall Street Journal, follow a 32-month investigation by the committee in preparation for an upcoming hearing featuring executives from the largest PBMs in the country. PBMs serve as third-party administrators for prescription drug plans and negotiate prices between health insurers and pharmaceutical companies, also determining patients’ out-of-pocket expenses.
The three largest PBMs in the U.S.—Express Scripts, OptumRx from UnitedHealth Group, and CVS Health’s Caremark—control nearly 80% of prescription medications. The committee’s investigation indicated that these PBMs have established lists of preferred drugs that tend to favor higher-priced brand-name medications instead of more affordable alternatives.
For instance, internal communications from Cigna were highlighted, which suggested avoiding less expensive alternatives to Humira, a drug for arthritis and autoimmune conditions, that was priced at $90,000 annually at the time, even though a similar biosimilar was available for around half that cost.
Furthermore, the report indicated that Express Scripts informed patients they would incur greater costs by filling prescriptions at local pharmacies compared to obtaining a three-month supply through its associated mail-order service, thereby restricting patient pharmacy choices.
Earlier this month, the U.S. Federal Trade Commission (FTC) released a corresponding report, noting that the largest six PBMs now manage almost 95% of prescriptions in the country. The FTC expressed concern over the significant influence these leading PBMs wield over Americans’ access to and affordability of prescription drugs. This situation contributes to a structure where vertically integrated PBMs might prioritize their own businesses, potentially harming unaffiliated pharmacies and pushing up drug prices.
FTC Chair Lina M. Khan emphasized that these middlemen are notably overcharging patients for cancer treatments, resulting in excess revenues exceeding $1 billion.