A recent report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are directing patients toward more costly medications while restricting pharmacy choices. This report follows a lengthy 32-month investigation and precedes a scheduled hearing involving executives from the largest PBMs in the country.
PBMs, which act as intermediaries for health insurers handling prescription drug plans, negotiate prices with pharmaceutical companies and establish out-of-pocket expenses for patients. The three largest PBMs in the U.S.—Express Scripts, OptumRx (part of UnitedHealth Group), and Caremark (owned by CVS Health)—control about 80% of all prescriptions filled in the country.
According to the findings, these PBMs maintain preferred drug lists that favor higher-priced brand name medications over more affordable alternatives. An example highlighted in the report includes internal communications from Cigna discouraging the use of less expensive alternatives to Humira, a drug for arthritis and other autoimmune disorders, which costs around $90,000 annually, despite the availability of a biosimilar for half that price.
Furthermore, the committee found that Express Scripts informed patients they would incur higher costs by filling prescriptions at their local pharmacies compared to obtaining a three-month supply through its affiliated mail-order service, thereby limiting patient pharmacy options.
In a related context, the U.S. Federal Trade Commission (FTC) released an interim report earlier this month, stating that the growing concentration and vertical integration of the six largest PBMs allows them to control nearly 95% of prescriptions filled in the United States. The FTC expressed concern about the substantial power these PBMs have over Americans’ access to affordable medications, suggesting that this system may lead to conflicts of interest that result in higher costs and disadvantage independently operated pharmacies.
FTC Chair Lina M. Khan emphasized that these findings indicate that these intermediaries are inflating costs for cancer medications, generating over $1 billion in additional revenue from affected patients.