A recent report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are directing patients toward more costly medications while restricting their pharmacy options. The report, reviewed by the Wall Street Journal, comes after a 32-month investigation related to an upcoming hearing featuring executives from the largest PBMs in the country.
PBMs serve as intermediaries for health insurers, negotiating prices with pharmaceutical companies and determining out-of-pocket costs for patients. The three largest PBMs—Express Scripts, OptumRx (a part of UnitedHealth Group), and Caremark (owned by CVS Health)—collectively manage around 80% of prescriptions in the U.S.
The committee’s findings indicate that PBMs have established preferred drug lists favoring higher-priced brand-name medications over more affordable alternatives. For instance, emails from Cigna highlighted discouragement against utilizing cheaper substitutes for Humira, a medication for arthritis and autoimmune diseases that had an annual cost of $90,000, despite the availability of a biosimilar at half that price.
Additionally, Express Scripts informed patients that they would incur higher costs by filling prescriptions at local pharmacies compared to a three-month supply through its affiliated mail-order pharmacy. This practice reportedly restricts patient choices regarding pharmacy selection.
Earlier this month, the U.S. Federal Trade Commission (FTC) released a similar report, noting that increased consolidation within the industry has allowed the six largest PBMs to control nearly 95% of all prescriptions filled in the U.S. The FTC expressed concern over the significant influence these PBMs have over Americans’ access to affordable medications. The report suggested that vertically integrated PBMs might prioritize their affiliated businesses, creating conflicts of interest that disadvantage independent pharmacies and escalate prescription costs.
FTC Chair Lina M. Khan highlighted that these findings indicate that PBMs are “overcharging patients for cancer drugs,” resulting in excess revenue exceeding $1 billion.