A recent report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are directing patients towards more costly medications while restricting their options for where to obtain them. The findings, which were highlighted in the Wall Street Journal, stem from a thorough 32-month investigation that coincided with an upcoming hearing featuring executives from leading PBMs.
PBMs act as intermediaries for prescription drug plans provided by health insurers, negotiating prices with pharmaceutical companies and determining the out-of-pocket expenses that patients face. The three largest PBMs in the United States—Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark—control roughly 80% of prescriptions filled nationwide.
The committee’s investigation found that these managers have developed lists of preferred drugs prioritizing higher-priced brand-name medications over cheaper alternatives. For instance, emails from Cigna staff discouraged the use of more affordable substitutes for Humira, a treatment for autoimmune disorders which was priced at $90,000 annually, even though at least one biosimilar was available for half that cost.
Additionally, Express Scripts reportedly informed patients that filling prescriptions at local pharmacies would be more expensive than using its affiliated mail-order service, effectively narrowing patients’ pharmacy options.
Earlier this month, the U.S. Federal Trade Commission released a similar report indicating that growing vertical integration and concentration has allowed the six largest PBMs to control nearly 95% of all prescriptions filled in the country. The FTC expressed concern over the considerable influence these PBMs wield over Americans’ access to affordable medications, warning that this arrangement can foster conflicts of interest that disadvantage independent pharmacies and hike up drug prices.
FTC Chair Lina M. Khan underscored the implications of these findings, stating that the actions of these intermediaries may be contributing to inflated costs for cancer medications, reportedly generating over $1 billion in additional revenue for PBMs.