A recent report from the House Committee on Oversight and Accountability indicates that pharmacy-benefit managers (PBMs) are directing patients toward more expensive medications while limiting their pharmacy options. This report, which followed a 32-month investigation, was reviewed by the Wall Street Journal ahead of an upcoming hearing featuring executives from some of the country’s largest PBMs.
PBMs act as third-party administrators for prescription drug plans offered by health insurers, negotiating prices with pharmaceutical companies and setting the out-of-pocket costs for patients. The three largest PBMs—Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark—handle around 80% of prescriptions in the United States.
The committee’s findings suggest that PBMs often maintain lists of preferred drugs that highlight higher-priced brand names over more affordable alternatives. An example mentioned involves Cigna, where communications reportedly advised against using less expensive alternatives to Humira—a drug for arthritis and autoimmune conditions priced at $90,000 annually—despite the availability of a biosimilar for half that cost.
Moreover, the committee discovered that patients were informed by Express Scripts that seeking a prescription at local pharmacies would cost them more than obtaining a three-month supply from its affiliated mail-order service, restricting their pharmacy choices.
Earlier this month, the U.S. Federal Trade Commission (FTC) released a similar report stating that increased vertical integration among PBMs has allowed the six largest managers to oversee nearly 95% of all prescriptions in the country. The FTC expressed concerns over the growing power of PBMs, which could limit Americans’ access to affordable medications and create conflicts of interest favoring their own affiliated businesses.
FTC Chair Lina M. Khan highlighted that these middlemen may be overcharging patients for cancer treatments, resulting in extra revenue exceeding $1 billion.