A recent report from the House Committee on Oversight and Accountability has revealed that pharmacy-benefit managers (PBMs) are directing patients towards more expensive medications and restricting their pharmacy options. This report followed a 32-month investigation and precedes an upcoming hearing involving executives from the country’s largest PBM companies.
PBMs serve as third-party administrators for prescription drug plans on behalf of health insurers, negotiating drug prices with pharmaceutical manufacturers and determining patients’ out-of-pocket costs. The three largest PBMs—Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark—control approximately 80% of U.S. prescriptions.
The committee’s findings suggest that PBMs have developed preferred drug lists that feature higher-priced brand-name drugs instead of more affordable alternatives. For instance, emails from Cigna staff emphasized discouraging the use of cheaper alternatives to Humira, an arthritis treatment costing $90,000 annually, while one available biosimilar was priced at half that amount.
Moreover, the report indicated that Express Scripts advised patients that filling prescriptions at local pharmacies would be more costly than obtaining a three-month supply from their mail-order pharmacy, thereby constraining patient choices regarding their pharmacy options.
Earlier this month, the U.S. Federal Trade Commission (FTC) released a similar report, highlighting that increasing consolidation has allowed the six largest PBMs to manage nearly 95% of all U.S. prescriptions. The FTC expressed concerns over the considerable power PBMs wield over Americans’ access to affordable medications and the potential conflicts of interest that may arise from their ability to prioritize their affiliated businesses, potentially disadvantaging independent pharmacies and driving up drug costs.
FTC Chair Lina M. Khan pointed out that these findings indicate that PBMs are “overcharging patients for cancer drugs,” resulting in over $1 billion in extra revenue.