Pharmacy benefit managers (PBMs) are directing patients towards more expensive medications and restricting where they can obtain them, according to a newly released report from the House Committee on Oversight and Accountability.
The report, shared with the Wall Street Journal, is the culmination of a 32-month inquiry by the committee, which is scheduled to hold a hearing involving executives from the nation’s largest PBMs.
PBMs are third-party administrators who manage prescription drug plans for health insurance companies. They negotiate prices with pharmaceutical companies regarding the costs that health plans will pay for medications. Additionally, these managers determine patient out-of-pocket expenses.
The three largest PBMs in the U.S.—Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark—together control approximately 80% of all U.S. prescriptions.
According to the committee’s findings, PBMs have developed preferred drug lists that favor higher-priced brand-name medications over less expensive options. An example cited in the report includes emails from Cigna that discouraged healthcare providers from prescribing cheaper alternatives to Humira, a drug used for treating arthritis and other autoimmune disorders, which had an annual cost of $90,000. A biosimilar was available for approximately half that amount.
The report also indicated that Express Scripts informed patients they would incur higher costs by filling prescriptions at their local pharmacies compared to obtaining a three-month supply through its affiliated mail-order service, which restricted patient choices regarding pharmacy options.
Earlier this month, the U.S. Federal Trade Commission (FTC) published a similar report, noting that “increasing vertical integration and concentration has enabled the six largest PBMs to manage nearly 95% of all prescriptions filled in the United States.”
These findings raise significant concerns. The FTC stated, “The leading PBMs now exercise significant power over Americans’ ability to access and afford their prescription drugs.” The agency highlighted issues related to conflicts of interest created by vertically integrated PBMs that may favor their own businesses, potentially disadvantaging non-affiliated pharmacies and driving up prescription drug costs.
FTC Chair Lina M. Khan noted that the findings indicate that these intermediaries are “overcharging patients for cancer drugs,” generating additional revenue exceeding $1 billion.