A new report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are pushing patients towards higher-priced medications while restricting their pharmacy options. The report, which has been reviewed by the Wall Street Journal, follows a 32-month investigation leading up to a hearing on PBMs involving top executives from major management firms.
PBMs act as intermediaries that manage prescription drug plans for health insurers, negotiating prices with pharmaceutical companies and determining patients’ out-of-pocket costs. The three largest PBMs in the U.S.—Express Scripts, OptumRx (part of UnitedHealth Group), and Caremark (a part of CVS Health)—control around 80% of prescription medications in the country.
The committee’s findings indicate that these PBMs have established preferred drug lists that prioritize more expensive brand-name drugs over less costly alternatives. For instance, the report mentions communications from Cigna staff advising against the use of cheaper substitutes for Humira, a medication costing $90,000 annually at that time, despite the availability of a biosimilar for half that price.
Moreover, the committee highlighted that Express Scripts informed patients they would incur higher costs if they opted for prescriptions filled at local pharmacies compared to obtaining a three-month supply from their mail-order service, thereby limiting patient choice in pharmacy selection.
Earlier this month, the U.S. Federal Trade Commission (FTC) released a similar report indicating that the six largest PBMs control nearly 95% of all filled prescriptions in the U.S. The FTC expressed concern over the considerable power these leading PBMs have in terms of patients’ access to affordable medications. The report suggested that the structure enables PBMs to favor their own affiliated entities, creating conflicts of interest that can harm independent pharmacies and inflate prescription drug prices.
FTC Chair Lina M. Khan remarked that the findings indicate these middlemen are “overcharging patients for cancer drugs,” resulting in more than $1 billion in additional revenue for them.