A recent report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are directing patients to more expensive medications and restricting their options for pharmacies.
The report, obtained by the Wall Street Journal, is the result of a 32-month investigation conducted by the committee ahead of a hearing involving executives from leading PBM firms.
PBMs act as intermediaries for health insurers’ prescription drug plans, negotiating prices with pharmaceutical companies and determining patients’ out-of-pocket costs. The three largest PBMs—Express Scripts, OptumRx from UnitedHealth Group, and CVS Health’s Caremark—control about 80% of prescription drug distribution in the U.S.
The findings indicate that PBMs favor higher-priced brand-name drugs over affordable alternatives. For instance, the report highlights internal communications from Cigna, which discouraged the use of lower-cost alternatives to Humira, a drug for arthritis and other autoimmune conditions that costs around $90,000 annually, despite available biosimilars at half the price.
Additionally, the committee noted that Express Scripts informed patients they would incur higher costs by filling prescriptions at local pharmacies compared to obtaining a three-month supply through their affiliated mail-order service, thereby restricting patient choice.
Earlier this month, the U.S. Federal Trade Commission (FTC) released a report stating that increased consolidation among PBMs has enabled the six largest firms to manage nearly 95% of all prescriptions filled in the U.S. The FTC expressed concern that PBMs wield considerable influence over Americans’ access to affordable medications. The report suggests that vertically integrated PBMs might favor their own related businesses, creating conflicts of interest that can harm independent pharmacies and elevate drug pricing.
FTC Chair Lina M. Khan indicated that these findings demonstrate how these middlemen are potentially overcharging patients for vital medications, resulting in excess revenues exceeding $1 billion.