Pharmacy-benefit managers (PBMs) are reportedly directing patients toward higher-priced medications and restricting their options for obtaining these drugs, according to a recent report from the House Committee on Oversight and Accountability.
The report, examined by the Wall Street Journal, comes after a 32-month investigation by the committee in advance of a hearing involving executives from the nation’s largest PBMs.
PBMs serve as third-party administrators for prescription drug plans provided by health insurers. They negotiate prices with pharmaceutical companies on behalf of health plans and establish out-of-pocket costs for patients.
The top three PBMs in the U.S.—Express Scripts, OptumRx (owned by UnitedHealth Group), and Caremark (part of CVS Health)—manage around 80% of all U.S. prescriptions.
The committee’s findings indicate that these PBMs have developed lists of preferred medications that prioritize higher-priced brand-name drugs over cheaper alternatives. For instance, the report highlights internal communications from Cigna that discouraged using less expensive alternatives to Humira, a medication for arthritis and other autoimmune diseases, which costs approximately $90,000 annually, despite the availability of a biosimilar for half that price.
Additionally, the committee discovered that Express Scripts informed patients that they would incur higher costs by filling prescriptions at local pharmacies instead of obtaining a three-month supply through its affiliated mail-order services, thereby limiting patients’ pharmacy choices.
A similar report was released by the U.S. Federal Trade Commission (FTC) earlier this month, revealing that “increasing vertical integration and concentration” has allowed the six largest PBMs to control nearly 95% of all prescriptions filled in the country.
The FTC’s findings raise concerns, stating that “the leading PBMs now exercise significant power over Americans’ ability to access and afford their prescription drugs.” The report also notes a system where “vertically integrated PBMs appear to have the ability and incentive to prefer their own affiliated businesses, creating conflicts of interest that can harm independent pharmacies and raise prescription drug prices.”
FTC Chair Lina M. Khan pointed out that these findings indicate that such middlemen are “overcharging patients for cancer drugs,” generating an additional revenue exceeding $1 billion.