A recent report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are directing patients towards more expensive medications and restricting their options for pharmacies. This findings come after a 32-month investigation and precede a hearing involving top executives from the nation’s major PBMs.
PBMs act as intermediaries between insurers and pharmaceutical companies, determining the prices that health plans pay for medications and setting patient out-of-pocket costs. The three largest PBMs—Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark—collectively oversee about 80% of prescriptions in the United States.
The report indicates that PBMs have been favoring higher-priced brand-name drugs in their preferred medication lists, often at the expense of cheaper alternatives. One example highlighted involves Cigna staff discouraging the use of more affordable substitutes for Humira, an arthritis treatment priced at $90,000 annually, despite the availability of a biosimilar for half that amount.
Furthermore, the committee noted that Express Scripts informed patients that filling a prescription at their local pharmacy would be more costly than obtaining a three-month supply from its affiliated mail-order service, thereby restricting pharmacy choices for patients.
A related report from the U.S. Federal Trade Commission (FTC) noted that the largest six PBMs control nearly 95% of prescriptions filled in the country. The FTC expressed concerns over the considerable authority these leading PBMs have in determining patient access to affordable medications. The report also pointed out potential conflicts of interest, as vertically integrated PBMs may prioritize their own businesses, ultimately leading to higher drug prices and disadvantaging independent pharmacies.
FTC Chair Lina M. Khan emphasized that the findings indicate these intermediaries are increasing costs for cancer medications, generating over $1 billion in extra revenue.