A recent report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are guiding patients toward more expensive medications while restricting their access to these drugs. This report, obtained by the Wall Street Journal, follows a detailed 32-month investigation and is timed with an upcoming hearing featuring executives from the country’s largest PBMs.
PBMs act as third-party administrators for health insurers’ prescription drug plans, negotiating prices with pharmaceutical companies. They also determine patients’ out-of-pocket expenses. The three largest PBMs in the U.S.—Express Scripts, OptumRx (a UnitedHealth Group company), and Caremark (CVS Health)—manage around 80% of all prescriptions.
The committee’s findings indicate that these PBMs often compile preferred drug lists that prioritize higher-priced brand-name drugs over more affordable alternatives. For instance, emails from Cigna highlighted a campaign discouraging the use of less costly options for Humira, a medication for arthritis, which had a price tag of $90,000 per year, despite the availability of a biosimilar at half that cost.
Furthermore, Express Scripts allegedly informed patients that opting for a local pharmacy would result in higher costs compared to a three-month supply from their affiliated mail-order service, effectively restricting patients’ choices regarding pharmacy selection.
Earlier this month, the U.S. Federal Trade Commission (FTC) released a similar report stating that increased vertical integration among PBMs has led them to control nearly 95% of all prescriptions in the United States. The FTC expressed concern about the significant influence PBMs wield over Americans’ access to affordable medications. The report warns that this dominance fosters a system where PBMs may favor their own affiliated businesses, leading to potential conflicts of interest that can harm independent pharmacies and drive up drug prices.
FTC Chair Lina M. Khan emphasized that these findings indicate that PBMs are overcharging patients for vital medications, particularly cancer drugs, generating over $1 billion in additional revenue from these practices.