A recent report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are guiding patients towards more costly medications while restricting their choices for where to obtain them.
The report, which followed a thorough 32-month investigation, precedes a hearing set to address the actions of PBM executives from the nation’s largest managers, as reported by the Wall Street Journal.
PBMs serve as intermediaries for prescription drug plans offered by health insurers, negotiating prices with pharmaceutical companies and determining the out-of-pocket costs for patients. The three largest PBMs in the country—Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark—manage about 80% of prescriptions in the United States.
The investigation uncovered that PBMs have established preferred drug lists that favor higher-priced brand-name medications over more affordable alternatives. One notable example mentioned in the report involves Cigna discouraging the use of cheaper substitutes for Humira, an arthritis treatment costing approximately $90,000 annually, despite a biosimilar being available for half that price.
Additionally, the committee found that Express Scripts informed patients they would incur higher costs if they filled prescriptions at local pharmacies compared to ordering a three-month supply through its associated mail-order service, effectively limiting patients’ pharmacy options.
Earlier this month, the U.S. Federal Trade Commission (FTC) released a similar report, stating that increased consolidation among PBMs has led to six major companies managing nearly 95% of all prescriptions in the U.S.
The FTC expressed concerns regarding the significant power these leading PBMs now hold over Americans’ access to affordable prescription drugs. This environment fosters potential conflicts of interest, as vertically integrated PBMs may favor their affiliated entities, disadvantaging independent pharmacies and raising drug prices for consumers. FTC Chair Lina M. Khan noted that these practices result in patients being overcharged for cancer medications, generating over $1 billion in additional revenue for the PBMs.