A recent report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are guiding patients toward more expensive medications while restricting their choices in pharmacies. This finding is part of a lengthy 32-month investigation by the committee, which anticipates a hearing featuring executives from the nation’s largest PBMs.
PBMs serve as intermediaries for health insurers in administering prescription drug plans, negotiating prices with pharmaceutical companies, and determining patient out-of-pocket expenses. The three largest PBMs in the U.S. — Express Scripts, OptumRx from UnitedHealth Group, and Caremark from CVS Health — handle around 80% of U.S. prescriptions.
The committee’s findings indicate that PBMs often prioritize higher-priced brand-name drugs on their preferred drug lists, even when more affordable alternatives exist. One example highlighted in the report involves Cigna staff discouraging the use of low-cost alternatives to the arthritis drug Humira, which was priced at approximately $90,000 annually, while a biosimilar option was available for half that cost.
Additionally, the report states that Express Scripts informed patients they would incur greater costs by filling prescriptions at local pharmacies compared to obtaining a three-month supply from their affiliated mail-order service, effectively limiting pharmacy choice for patients.
A similar report released by the U.S. Federal Trade Commission (FTC) noted that six major PBMs now manage nearly 95% of U.S. prescriptions, raising concerns about their influence. The FTC warned that this concentration of power allows PBMs to control access to affordable medications and can lead to conflicts of interest favoring their own affiliated businesses, thereby raising drug costs.
FTC Chair Lina M. Khan emphasized that these middlemen are contributing to higher costs for cancer medications, generating over $1 billion in additional revenue.