A recent report from the House Committee on Oversight and Accountability has revealed that pharmacy-benefit managers (PBMs) are directing patients toward more costly medications while restricting their pharmacy options. This findings follow a 32-month investigation conducted by the committee prior to a hearing featuring executives from the largest PBM companies in the country.
PBMs function as third-party administrators for prescription drug plans offered by health insurers. They engage in negotiations with pharmaceutical companies regarding the prices that health plans will pay for various medications and also determine the out-of-pocket expenses patients incur.
The three largest PBMs—Express Scripts, OptumRx from UnitedHealth Group, and Caremark from CVS Health—control around 80% of all prescriptions filled in the United States.
According to the committee’s findings, PBMs have been creating lists of preferred medications that prioritize expensive brand-name drugs over more affordable alternatives. The report highlighted emails from Cigna employees that discouraged the use of cheaper options for Humira, a drug used to treat arthritis and other autoimmune conditions, which was priced at $90,000 annually, despite the existence of a biosimilar that cost significantly less.
Furthermore, it was noted that Express Scripts informed patients that they would incur higher costs by obtaining prescriptions at local pharmacies compared to purchasing a three-month supply through their affiliated mail-order service. This practice effectively limits patients’ choices regarding their pharmacy options.
Earlier this month, the U.S. Federal Trade Commission (FTC) released a similar report indicating that an increase in vertical integration among PBMs has led to the six largest managers overseeing almost 95% of all prescriptions filled in the United States. This concentration of power raises concerns about access to affordable medications. The FTC stated that the leading PBMs now wield substantial influence over Americans’ ability to afford their prescription drugs, often favoring their own affiliated businesses and disadvantaging independent pharmacies. FTC Chair Lina M. Khan noted that these middlemen have been overcharging patients for cancer medications, resulting in an additional $1 billion in revenue for them.