Pharmacy-benefit managers (PBMs) are reportedly directing patients towards more costly medications and restricting their options for obtaining them, as highlighted in a recent report from the House Committee on Oversight and Accountability.
The report indicates that Medicare patients could collectively save $1.5 billion on a selection of ten prescription medicines, following a 32-month investigation by the committee. This investigation precedes a hearing involving executives from the nation’s largest PBMs.
PBMs serve as intermediaries in prescription drug plans for health insurers, negotiating prices with pharmaceutical companies and determining patients’ out-of-pocket expenses. The three leading PBMs in the U.S. – Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark – manage roughly 80% of prescriptions.
According to the report, these PBMs have established preferred drug lists that favor higher-priced brand-name drugs over more affordable alternatives. An example cited in the report includes emails from Cigna staff discouraging the use of cheaper substitutes for Humira, a treatment for arthritis and autoimmune conditions that cost approximately $90,000 annually, despite the availability of a biosimilar for half that amount.
The committee also found instances where Express Scripts informed patients that filling a prescription at a local pharmacy would be more expensive than obtaining a three-month supply from its affiliated mail-order service. This practice effectively limited patients’ choices of pharmacies.
Earlier this month, the U.S. Federal Trade Commission (FTC) released a similar report, noting that “increasing vertical integration and concentration” has allowed the six largest PBMs to control nearly 95 percent of all prescriptions filled across the United States.
The findings underscore significant concerns. The FTC noted, “The leading PBMs now exercise significant power over Americans’ ability to access and afford their prescription drugs.” This situation fosters a system where vertically integrated PBMs could have the means and motivation to favor their own related businesses, potentially disadvantaging independent pharmacies and inflating drug costs. FTC Chair Lina M. Khan remarked that these intermediaries are “overcharging patients for cancer drugs,” generating additional revenues exceeding $1 billion.