Pharmacy-benefit managers (PBMs) are directing patients towards more costly medications and restricting their options for pharmacies, according to a recent report from the House Committee on Oversight and Accountability.
The report suggests that Medicare patients could collectively save $1.5 billion on ten specific prescription drugs. This document, reviewed by the Wall Street Journal, comes as a result of a 32-month investigation by the committee, preparing for a hearing featuring executives from the largest PBMs in the country.
PBMs act as intermediaries for prescription drug plans under health insurers, negotiating prices with pharmaceutical companies and establishing out-of-pocket expenses for patients. The three largest PBMs—Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark—manage around 80% of all prescriptions in the U.S.
The committee’s findings indicate that these managers have developed preferred drug lists favoring higher-priced branded drugs over more affordable options. An example highlighted in the report includes internal communications from Cigna discouraging the use of cheaper alternatives to Humira, a medication for arthritis, which at the time cost $90,000 annually, while a biosimilar was available for half the price.
Moreover, it was revealed that Express Scripts informed patients they would incur higher costs by filling prescriptions at local pharmacies compared to obtaining a three-month supply from its affiliated mail-order service, thus limiting patient choice regarding pharmacy selection.
In a related report published earlier this month, the U.S. Federal Trade Commission (FTC) noted that increased vertical integration and concentration allow the six largest PBMs to manage nearly 95% of all prescriptions filled in the nation. The FTC’s findings raise concerns about the significant influence PBMs hold over patients’ accessibility to affordable prescription drugs.
This structure presents a scenario where integrated PBMs may favor their own businesses, creating conflicts of interest that could harm independent pharmacies and drive up drug prices. FTC Chair Lina M. Khan pointed out that these middlemen are reportedly “overcharging patients for cancer drugs,” resulting in over $1 billion in additional revenue.