A recent report from the House Committee on Oversight and Accountability has revealed that pharmacy-benefit managers (PBMs) are directing patients towards more costly medications while restricting their pharmacy options. The report, which followed a 32-month investigation, provides insights ahead of a scheduled hearing involving executives from the largest PBMs in the country.
PBMs serve as intermediaries for health insurers, negotiating prices with pharmaceutical companies for prescription drugs. They also determine the out-of-pocket costs that patients face. The three largest PBMs in the United States—Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark—handle approximately 80% of all prescriptions.
The committee’s investigation uncovered that these PBMs have established lists of preferred drugs that favor higher-priced brand-name medications over more affordable alternatives. For example, the report highlights correspondence from Cigna staff discouraging the use of lower-cost substitutes for Humira, a drug for treating arthritis and other autoimmune disorders, which had a yearly cost of $90,000, despite the availability of a biosimilar priced at half that amount.
Additionally, the report indicated that Express Scripts informed patients that they would incur higher costs when getting prescriptions filled at local pharmacies compared to obtaining a three-month supply through its mail-order service. This practice effectively limited patients’ choices regarding where to fill their prescriptions.
Compounding these findings, the U.S. Federal Trade Commission (FTC) released a report earlier this month indicating that rising vertical integration has allowed the six largest PBMs to control nearly 95% of all prescriptions in the U.S. The FTC’s interim report emphasized the significant power PBMs hold over patients’ access to affordable medications, creating a system where their affiliations can lead to conflicts of interest, potentially disadvantaging independent pharmacies and driving up drug prices.
FTC Chair Lina M. Khan stated that these findings reveal how middlemen are overcharging patients for essential medications, especially cancer drugs, contributing to an excess of over $1 billion in revenues for PBMs.