Pharmacy-benefit managers (PBMs) are guiding patients toward more expensive medications and restricting their pharmacy options, according to a new report from the House Committee on Oversight and Accountability.
The report, as reviewed by the Wall Street Journal, comes after a 32-month investigation by the committee. This precedes a hearing involving executives from the nation’s largest PBMs.
PBMs act as third-party administrators of prescription drug plans for health insurers, negotiating with pharmaceutical companies on drug prices and determining out-of-pocket costs for patients.
Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark, which are the three largest PBMs, manage about 80% of U.S. prescriptions.
The committee’s report states that PBMs have developed lists of preferred drugs that feature more expensive brand-name medications instead of cheaper alternatives, as reported by the Wall Street Journal.
An example noted in the report involves emails from staff at Cigna, which discouraged using less expensive alternatives to Humira, an arthritis and autoimmune treatment that cost $90,000 per year at the time, even though at least one biosimilar was available at half that price.
Moreover, the committee discovered that Express Scripts informed patients that they would pay more for a prescription filled at a local pharmacy compared to obtaining a three-month supply from its affiliated mail-order pharmacy, effectively limiting patients’ pharmacy choices.
Earlier this month, the U.S. Federal Trade Commission (FTC) released a similar report. The FTC’s interim report highlighted that increasing vertical integration and concentration have allowed the six largest PBMs to control nearly 95% of all U.S. prescription fills.
The findings raise significant concerns. The FTC noted that the leading PBMs wield considerable power over Americans’ access to and affordability of prescription drugs. This situation creates a system where vertically integrated PBMs may prioritize their own affiliated businesses, leading to conflicts of interest and higher prescription drug costs.
According to FTC Chair Lina M. Khan, the findings indicate that these middlemen are “overcharging patients for cancer drugs,” resulting in more than $1 billion in additional revenue.
Ben Kesslen contributed to this article.