A recent report by the House Committee on Oversight and Accountability highlights that pharmacy benefit managers (PBMs) are directing patients to more expensive medications and restricting their pharmacy options. This findings were drawn from a 32-month investigation leading up to a hearing involving executives from the nation’s major PBMs.
PBMs act as intermediaries between health insurers and pharmaceutical companies, negotiating prices for drugs while determining patient out-of-pocket costs. The three largest PBMs in the U.S.—Express Scripts, OptumRx (part of UnitedHealth Group), and CVS Health’s Caremark—administrate around 80% of all prescriptions.
According to the report, these managers have established lists that favor pricier brand-name drugs over more affordable generics. For instance, one highlighted email from Cigna staff advised against opting for cheaper alternatives to Humira, a costly arthritis treatment priced at $90,000 annually, even though a biosimilar was available for half that amount.
Furthermore, the committee discovered that Express Scripts informed patients they would pay more for prescriptions filled at local pharmacies compared to obtaining a three-month supply from its own mail-order service, thus restricting patient pharmacy choices.
The U.S. Federal Trade Commission (FTC) released a similar report earlier in the month, indicating that the six largest PBMs control nearly 95% of prescriptions filled in the country due to increased vertical integration and market concentration.
TheFTC’s findings raise concerns about the significant influence these leading PBMs hold over Americans’ access to affordable medications. This system may lead to conflicts of interest as vertically integrated PBMs could favor their own affiliated businesses, potentially disadvantaging independent pharmacies and inflating drug prices. FTC Chair Lina M. Khan noted that these intermediaries are “overcharging patients for cancer drugs,” contributing over $1 billion in additional revenue.