Pharmacy-benefit managers (PBMs) are directing patients towards more costly medications and restricting their options for obtaining them, according to a recent report released by the House Committee on Oversight and Accountability.
The report, which was reviewed by the Wall Street Journal, is the result of a 32-month investigation by the committee in advance of a hearing involving executives from the largest PBMs in the nation.
PBMs act as intermediaries for prescription drug plans on behalf of health insurers, negotiating drug prices with pharmaceutical companies. They also determine the out-of-pocket costs faced by patients.
The three largest PBMs in the United States—Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark—manage around 80% of prescriptions in the country.
According to the committee’s findings, PBMs have compiled lists of preferred medications that primarily feature higher-priced brand-name drugs instead of more affordable alternatives. The report highlights emails from staff at Cigna that discouraged the adoption of cheaper substitutes for Humira, an arthritis medication that cost $90,000 annually, even though at least one biosimilar was available for about half the price.
Furthermore, the report indicated that Express Scripts advised patients that they would incur higher costs by filling prescriptions at their local pharmacies compared to obtaining a three-month supply from its associated mail-order pharmacy. This practice reportedly restricts patients’ choices regarding where they can fill their prescriptions.
Earlier this month, the U.S. Federal Trade Commission (FTC) issued a similar report, stating that due to increased vertical integration and concentration, the six largest PBMs now manage nearly 95% of all prescriptions filled in the United States.
The findings raised concerns, with the FTC commenting that the dominant PBMs wield considerable power over Americans’ access to and affordability of their prescription medications. This situation fosters a system in which vertically integrated PBMs may prioritize their affiliated businesses, thus creating conflicts of interest that could disadvantage independent pharmacies and inflate prescription drug costs.
FTC Chair Lina M. Khan noted that the findings indicate these intermediaries are overcharging patients for cancer drugs, generating more than $1 billion in additional revenue.