A recent report from the House Committee on Oversight and Accountability highlights concerns about pharmacy-benefit managers (PBMs) directing patients towards more expensive medications while restricting their pharmacy options. This follows a 32-month investigation ahead of a hearing that included executives from the country’s largest PBMs.
PBMs serve as intermediaries for prescription drug plans associated with health insurers, negotiating prices with pharmaceutical companies and determining patients’ out-of-pocket expenses. The top three PBMs in the U.S., Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark, account for about 80% of all prescriptions.
The committee revealed that PBMs have favored expensive brand-name drugs over less costly alternatives in their preferred drug lists. For instance, emails from Cigna staff discouraged the use of a biosimilar for Humira, a drug used to treat arthritis and other autoimmune diseases, which was priced at $90,000 annually, even though a similar treatment was available for half that cost.
Additionally, Express Scripts informed patients that they would incur higher costs if they filled prescriptions at local pharmacies, compared to using their mail-order service. This practice restricts patient choice regarding where to obtain their medications.
The issue was echoed in a recent report from the U.S. Federal Trade Commission, which indicated that increased concentration and vertical integration has enabled the top six PBMs to control nearly 95% of prescriptions filled in the U.S. The FTC expressed concern that the dominance of these PBMs significantly impacts patients’ access to affordable medications and creates conflicts of interest that could elevate drug prices, particularly disadvantaging independent pharmacies.
FTC Chair Lina M. Khan noted that these findings reveal that PBMs are overcharging patients for essential medications, particularly cancer drugs, resulting in over $1 billion in additional revenue for these intermediaries.