A recent report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are directing patients towards more costly medications and restricting their options for obtaining these drugs. This report comes after a thorough 32-month investigation into the practices of these managers, and it precedes a hearing involving executives from the largest PBMs in the United States.
PBMs act as intermediaries in prescription drug plans for health insurers, negotiating prices with pharmaceutical companies and determining out-of-pocket costs for patients. The three largest PBMs in the U.S.—Express Scripts, OptumRx (part of UnitedHealth Group), and Caremark (operated by CVS Health)—control approximately 80% of the nation’s prescriptions.
The findings indicate that PBMs often compile lists of preferred medications that favor higher-priced brand-name drugs over more affordable alternatives. An example highlighted in the report discusses Cigna staff discouraging patients from opting for cheaper substitutes for Humira, a costly treatment for arthritis, which was priced around $90,000 annually, despite the availability of a biosimilar option that cost significantly less.
Furthermore, the committee noted that Express Scripts informed patients that they would incur higher costs when filling prescriptions at local pharmacies compared to receiving a three-month supply from their mail-order pharmacy. This practice effectively curtails patients’ choices regarding where to purchase their medications.
The U.S. Federal Trade Commission (FTC) released a similar report earlier this month, stating that heightened vertical integration and market concentration have allowed the six largest PBMs to oversee nearly 95% of all prescriptions in the country. The FTC expressed concern over the considerable influence these PBMs have on Americans’ access to and affordability of prescription medications. Furthermore, they highlighted potential conflicts of interest, as vertically integrated PBMs may favor their own affiliated businesses at the expense of independent pharmacies and increased drug costs.
According to FTC Chair Lina M. Khan, the findings underscore that these intermediaries are charging patients excessively for cancer treatments, generating over $1 billion in additional revenue.