A recent report from the House Committee on Oversight and Accountability reveals that pharmacy benefit managers (PBMs) are directing patients toward costlier medications and restricting their pharmacy options. This finding comes after a 32-month investigation by the committee, which precedes a hearing featuring executives from the largest PBMs in the country.
PBMs act as intermediaries for prescription drug plans offered by health insurers, negotiating prices with pharmaceutical companies and establishing out-of-pocket expenses for patients. The three major PBMs in the U.S.—Express Scripts, OptumRx (part of UnitedHealth Group), and Caremark (affiliated with CVS Health)—control roughly 80% of the nation’s prescriptions.
The report indicates that these PBMs often favor more expensive brand-name drugs over cheaper alternatives by curating lists of preferred medications. For instance, it highlights communications from Cigna staff that discouraged prescribing less expensive alternatives to Humira, which, at the time, was priced at $90,000 annually, despite the availability of a biosimilar at half that price.
Additionally, it was found that Express Scripts informed patients they would incur higher costs by filling prescriptions at local pharmacies compared to obtaining a three-month supply through its affiliated mail-order services, thereby limiting patient choice in selecting pharmacies.
Earlier this month, the U.S. Federal Trade Commission (FTC) released a similar report, indicating that increasing consolidation among PBMs has allowed the six largest companies to manage nearly 95% of all prescriptions filled in the U.S. The FTC expressed concern over the substantial power PBMs hold over Americans’ access to affordable medications, warning that their vertical integration could create conflicts of interest that disadvantage independent pharmacies and raise drug prices.
FTC Chair Lina M. Khan stated that these findings illustrate how middlemen are increasing patient costs for cancer therapies, resulting in over $1 billion in additional revenue for them.