A recent report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are directing patients toward more expensive medications while restricting their pharmacy options. This report follows a 32-month investigation by the committee, which is set to hold a hearing involving executives from the largest PBM companies in the country.
PBMs act as intermediaries that manage prescription drug plans for health insurers, negotiating prices with pharmaceutical companies and determining out-of-pocket costs for patients. The three largest PBMs in the U.S.—Express Scripts, OptumRx (a subsidiary of UnitedHealth Group), and Caremark (part of CVS Health)—control around 80% of the nation’s prescription drugs.
The findings indicate that PBMs are creating “preferred drug” lists that favor costlier brand-name medications over more affordable alternatives. One example highlighted in the report is from Cigna, whose staff discouraged the use of more affordable treatments for Humira, a medication for arthritis, which was priced at $90,000 annually, despite similar biosimilars costing half that amount.
Moreover, the report cited concerns that Express Scripts informed patients that they would incur higher costs by obtaining prescriptions from local pharmacies instead of from their affiliated mail-order service, thereby limiting access to various pharmacy options.
Earlier this month, the U.S. Federal Trade Commission (FTC) released a similar report, indicating that heightened vertical integration among PBMs has allowed the six largest firms to manage nearly 95% of all U.S. prescriptions. These developments raise concerns about the influence PBMs have over Americans’ access to affordable medications. The FTC asserted that the current system creates potential conflicts of interest since vertically integrated PBMs may prioritize their affiliated businesses, often to the detriment of independent pharmacies and patients.
FTC Chair Lina M. Khan emphasized that the findings highlight how these intermediaries are allegedly overcharging patients for critical medications, leading to an excess revenue gain of over $1 billion related to cancer treatments.