Pharmacy-benefit managers (PBMs) are reportedly directing patients toward higher-cost medications and restricting their access to various pharmacies, according to a recent report released by the House Committee on Oversight and Accountability. This report, reviewed by the Wall Street Journal, follows a 32-month investigation ahead of a hearing involving executives from the largest PBMs in the country.
PBMs serve as third-party administrators for prescription drug plans on behalf of health insurers. They negotiate prices with pharmaceutical companies and determine the out-of-pocket costs that patients will incur. The three largest PBMs in the United States—Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark—collectively manage about 80% of all prescriptions.
The committee’s findings reveal that PBMs have generated lists of preferred medications, predominantly featuring costly brand-name drugs rather than more affordable alternatives. For instance, emails from staff at Cigna reportedly discouraged the use of lower-cost alternatives to Humira, a drug for arthritis and other autoimmune diseases that had a price tag of $90,000 annually, despite the availability of a biosimilar at half that price.
Additionally, the report indicates that Express Scripts informed patients they would incur higher costs for prescriptions filled at local pharmacies compared to obtaining a three-month supply through its affiliated mail-order service, thereby limiting patients’ pharmacy options.
A similar report by the U.S. Federal Trade Commission (FTC) released earlier this month highlighted that the increasing consolidation among PBMs has allowed the six largest firms to manage nearly 95% of all prescriptions in the U.S. The FTC expressed concern that leading PBMs now wield substantial influence over American patients’ ability to access and afford their prescriptions, creating potential conflicts of interest that could disadvantage independent pharmacies and result in higher drug costs.
FTC Chair Lina M. Khan noted that these practices have led to patients being overcharged for cancer medications, generating an excess revenue of more than $1 billion for these middlemen.