Pharmacy-benefit managers (PBMs) are directing patients towards more expensive drugs and restricting where they can obtain them, according to a recent report from the House Committee on Oversight and Accountability.
The report, reviewed by the Wall Street Journal, emerged after a 32-month investigation by the committee ahead of a hearing on PBMs involving leaders from the nation’s largest managers.
PBMs serve as third-party administrators of prescription drug plans for health insurers, negotiating prices with pharmaceutical companies and determining out-of-pocket costs for patients.
Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark, the country’s three largest PBMs, handle approximately 80% of U.S. prescriptions.
The committee’s report found that PBMs have created lists of preferred drugs consisting of higher-priced brand names over cheaper alternatives. For instance, the report mentions emails from Cigna staff that discouraged the use of more affordable alternatives to Humira, a treatment for arthritis and other autoimmune conditions costing $90,000 annually. At least one biosimilar was available for half that price.
Additionally, the committee discovered that Express Scripts directed patients to its affiliated mail-order pharmacy by informing them they would pay more if they filled prescriptions at their local pharmacy. This practice limited patients’ choices regarding which pharmacy they could use.
The U.S. Federal Trade Commission published a similar report earlier this month. According to the FTC’s interim report, “increasing vertical integration and concentration has enabled the six largest PBMs to manage nearly 95 percent of all prescriptions filled in the United States.”
The findings raise concerns. “The leading PBMs now exercise significant power over Americans’ ability to access and afford their prescription drugs,” the FTC stated. This centralization creates a system where “vertically integrated PBMs prefer their own affiliated businesses, resulting in conflicts of interest that can disadvantage unaffiliated pharmacies and increase prescription drug costs.”
FTC Chair Lina M. Khan noted that PBMs are “overcharging patients for cancer drugs,” resulting in additional revenue of over $1 billion.