A recent report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are guiding patients towards pricier medications while restricting their pharmacy options. This finding comes as part of an extensive 32-month investigation ahead of a hearing featuring executives from the largest PBM companies in the U.S.
PBMs operate as third-party administrators for prescription drug plans offered by health insurers. They negotiate prices with pharmaceutical companies and determine the out-of-pocket costs that patients face. The three largest PBMs, Express Scripts, OptumRx from UnitedHealth Group, and Caremark from CVS Health, manage about 80% of prescriptions in the United States.
The committee’s report indicates that PBMs have curated lists of preferred drugs that often highlight higher-priced brand-name medications instead of lower-cost alternatives. For instance, the report includes emails from Cigna staff that dissuaded the use of more affordable substitutes for Humira, an arthritis treatment that costs around $90,000 annually, even though a biosimilar was available for half that price.
Additionally, Express Scripts informed patients that obtaining a three-month supply from its own mail-order pharmacy would be cheaper than filling prescriptions at local pharmacies, which the committee argues restricts patients’ choices in pharmacy selection.
A similar report from the U.S. Federal Trade Commission (FTC) published earlier this month expressed concerns about the consolidation and vertical integration of PBMs, noting that the six largest manage nearly 95% of all U.S. prescriptions. The FTC highlighted the significant power these PBMs have over patients’ access to affordable medications, suggesting that this could create conflicts of interest that harm independent pharmacies and lead to higher drug prices.
FTC Chair Lina M. Khan stated that these findings indicate that PBMs may be overcharging cancer patients for their medications, generating excess revenue exceeding $1 billion.