A recent report from the House Committee on Oversight and Accountability has found that pharmacy-benefit managers (PBMs) are directing patients towards more expensive medications while restricting their pharmacy options. This report, reviewed by the Wall Street Journal, is the culmination of a 32-month investigation and precedes a hearing with executives from the largest PBMs in the country.
PBMs act as intermediaries for prescription drug plans on behalf of health insurers, negotiating prices with pharmaceutical companies and setting out-of-pocket costs for patients. The three largest PBMs—Express Scripts, OptumRx (owned by UnitedHealth Group), and CVS Health’s Caremark—control about 80% of U.S. prescriptions.
The committee’s findings indicate that PBMs have developed lists of preferred drugs that favor higher-priced brand-name medications over cheaper alternatives. For instance, the report mentions internal communications at Cigna that advised against using less expensive substitutes for Humira, a treatment for autoimmune conditions that was priced at $90,000 annually, despite the availability of biosimilars costing half that amount.
Additionally, it was revealed that Express Scripts informed patients that filling prescriptions at local pharmacies would be more costly than obtaining a three-month supply from their affiliated mail-order service, effectively limiting patient choices regarding pharmacies.
In a similar vein, the U.S. Federal Trade Commission released a report earlier this month stating that increased vertical integration among PBMs has allowed the six largest firms to oversee nearly 95% of all prescriptions in the U.S. The FTC expressed concern that these leading PBMs hold considerable influence over Americans’ access to and affordability of prescription drugs. Their findings suggested that vertically integrated PBMs might have incentives to favor their own businesses, which could disadvantage independent pharmacies and lead to higher drug prices.
FTC Chair Lina M. Khan highlighted that these middlemen may be significantly overcharging patients for cancer medications, resulting in an additional revenue gain exceeding $1 billion for the PBMs.