A new report from the House Committee on Oversight and Accountability has revealed that pharmacy-benefit managers (PBMs) are directing patients towards more expensive medications while restricting their available choices. The report comes after a 32-month investigation and precedes a hearing featuring executives from the largest PBMs in the country.
PBMs, third-party administrators of prescription drug plans for health insurers, negotiate medication prices with pharmaceutical companies and determine out-of-pocket expenses for patients. The three largest PBMs—Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark—control about 80% of U.S. prescriptions.
The committee’s findings indicate that preferred drug lists created by PBMs often include more expensive brand-name medications rather than cheaper alternatives. For instance, the report references internal communications at Cigna that discouraged using alternatives to Humira, a treatment for arthritis and autoimmune conditions, which at the time cost $90,000 annually, despite the availability of a biosimilar for half that price.
Additionally, Express Scripts reportedly informed patients that they would incur higher costs by filling prescriptions at local pharmacies compared to obtaining a three-month supply through its mail-order service, effectively limiting patients’ pharmacy options.
The U.S. Federal Trade Commission (FTC) released a similar report earlier this month, noting that the six largest PBMs manage nearly 95% of all prescriptions filled in the United States. The FTC found this elevated concentration problematic, indicating that major PBMs wield substantial power over patients’ access to affordable medications. The system can lead to conflicts of interest, particularly as vertically integrated PBMs may favor their own affiliated businesses, further driving up prescription drug costs.
FTC Chair Lina M. Khan emphasized the concerns raised by the findings, saying that patients are being overcharged for cancer medications, generating over $1 billion in additional revenue for these intermediaries.