A new report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are directing patients towards costlier medications and restricting their options for obtaining them.
The committee’s investigation, which lasted 32 months, was aimed at PBMs and took place ahead of a hearing involving executives from the largest PBM companies in the country. The report was reviewed by the Wall Street Journal.
PBMs, which serve as intermediaries for prescription drug plans on behalf of health insurers, negotiate pricing with pharmaceutical companies and determine the out-of-pocket expenses patients must pay. The three largest PBMs—Express Scripts, OptumRx (part of UnitedHealth Group), and Caremark (part of CVS Health)—control about 80% of all U.S. prescriptions.
The report indicates that these managers tend to prioritize higher-priced brand-name drugs on their preferred drug lists, sidelining less expensive options. An instance highlighted in the report involved communications from Cigna that advised against utilizing more affordable alternatives to Humira, a medication for arthritis and other autoimmune diseases that cost $90,000 annually, despite the availability of a biosimilar for half that price.
Moreover, the committee discovered that Express Scripts informed patients that filling prescriptions at local pharmacies would be more expensive than obtaining a three-month supply from their associated mail-order service, effectively limiting patients’ pharmacy choices.
In a related matter, the U.S. Federal Trade Commission (FTC) released a report earlier this month, indicating that the largest six PBMs handle nearly 95% of all prescriptions in the United States, as a result of increasing vertical integration and concentration.
The FTC expressed concern about the significant power these leading PBMs possess over Americans’ access to affordable medications. It also pointed out the potential conflict of interest due to vertically integrated PBMs favoring their own affiliated businesses, which may harm independent pharmacies and inflate prescription costs.
FTC Chair Lina M. Khan underscored that the findings indicate these intermediaries are “overcharging patients for cancer drugs,” leading to additional revenue exceeding $1 billion.