A new report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are directing patients toward more costly medications and restricting their pharmacy options. This is based on a thorough 32-month investigation ahead of a hearing involving leading PBM executives.
PBMs act as intermediaries managing prescription drug plans for health insurers. They negotiate drug prices with pharmaceutical companies and determine patient out-of-pocket costs. The three largest PBMs in the U.S.—Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark—account for approximately 80% of all prescriptions.
The committee’s findings indicate that PBMs have preferential drug lists prioritizing pricier branded medications over cheaper alternatives. An instance cited in the report highlights emails from Cigna employees discouraging the use of less expensive substitutes for Humira, a drug for arthritis and other autoimmune conditions, which cost approximately $90,000 annually at the time, despite the availability of a biosimilar at half that price.
Additionally, Express Scripts informed patients that they would face higher costs when filling prescriptions at local pharmacies compared to obtaining a three-month supply from its affiliated mail-order service, which restricts patient choices regarding their pharmacy.
A similar report from the U.S. Federal Trade Commission (FTC) earlier this month echoed these concerns, indicating that the six largest PBMs control nearly 95% of all prescriptions filled across the nation. The FTC expressed alarm over this concentration of power, stating that current practices by leading PBMs significantly affect Americans’ access to and affordability of prescription medications. The report also pointed to potential conflicts of interest that arise when PBMs prioritize their own businesses over others, leading to increased drug costs.
FTC Chair Lina M. Khan noted that these findings suggest that these intermediaries are inflating prices for cancer medications, generating excess revenue exceeding $1 billion.