A recent report from the House Committee on Oversight and Accountability accuses pharmacy benefit managers (PBMs) of directing patients toward more expensive medications and restricting their access to lower-cost options.
This report, which was reviewed by the Wall Street Journal, followed an extensive investigation lasting 32 months, coinciding with an upcoming hearing featuring executives from the country’s largest PBMs.
PBMs serve as third-party administrators for prescription drug plans, negotiating prices with drug manufacturers and determining the costs that patients must pay out-of-pocket. The three largest PBMs—Express Scripts, OptumRx (part of UnitedHealth Group), and CVS Health’s Caremark—manage around 80% of all prescriptions in the U.S.
According to the committee’s findings, these managers often create preferred drug lists that favor higher-priced brand-name medications over more affordable alternatives. For instance, the report highlights internal communications from Cigna that advised against using cheaper substitutes for Humira, a drug for arthritis and autoimmune issues that was priced at $90,000 annually, despite the availability of a biosimilar at a significantly lower cost.
Furthermore, the committee noted that Express Scripts informed patients that they would incur higher costs when filling prescriptions at local pharmacies compared to obtaining a three-month supply from their affiliated mail-order service. This practice effectively limits patient choices regarding where to fill prescriptions.
Earlier this month, the U.S. Federal Trade Commission released a report echoing similar concerns, indicating that the leading six PBMs manage nearly 95% of prescriptions filled in the country due to increasing consolidation and vertical integration in the industry.
The FTC’s findings raise alarms about the significant power that PBMs now wield over access to and affordability of prescription drugs. These managers allegedly create a system where their relationships with affiliated businesses might lead to conflicts of interest, to the detriment of independent pharmacies and ultimately increasing drug prices for consumers. FTC Chair Lina M. Khan stated that the evidence indicates these intermediaries are “overcharging patients for cancer drugs,” generating additional revenues exceeding $1 billion.