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 pharmacy options. This investigation, which lasted 32 months, was conducted in preparation for a hearing featuring executives from the nation’s largest PBMs.
PBMs serve as intermediaries who manage prescription drug plans for health insurers, negotiating prices with pharmaceutical companies and determining patient out-of-pocket costs. The three largest PBMs in the U.S.—Express Scripts, OptumRx (part of UnitedHealth Group), and Caremark (owned by CVS Health)—handle around 80% of all prescriptions filled in the country.
The report highlights that PBMs maintain lists of preferred medications that favor high-priced brand-name drugs over their more affordable counterparts. For instance, emails from Cigna’s staff discouraged patients from using cheaper alternatives to Humira, an arthritis treatment priced at $90,000 annually, despite the availability of a biosimilar at half the cost.
Additionally, findings show that Express Scripts advised patients that obtaining a three-month supply through their mail-order service would be cheaper than filling the same prescription at a local pharmacy. This practice restricts patient options regarding where to obtain their medications.
Earlier this month, the U.S. Federal Trade Commission (FTC) released a similar report stating that a significant shift towards vertical integration within the industry has allowed the six largest PBMs to control nearly 95% of all prescriptions in the United States. The FTC expressed concerns regarding the imbalance of power these PBMs have over patients’ access to affordable medications, noting that their practices could disadvantage independent pharmacies and contribute to rising prescription costs.
FTC Chair Lina M. Khan emphasized that these middlemen are potentially overcharging patients for essential medicines, particularly for cancer treatments, resulting in an excess revenue stream exceeding $1 billion.