A recent report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are directing patients towards more costly medications and restricting their choice of pharmacies. This report comes after a 32-month investigation and precedes a hearing featuring executives from the largest PBMs in the country.
PBMs, which act as intermediaries for health insurers in managing prescription drug plans, negotiate prices with pharmaceutical companies and determine patients’ out-of-pocket expenses. The three biggest PBMs in the U.S.—Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark—control around 80% of the nation’s prescriptions.
The committee’s findings indicate that PBMs have developed preferred drug lists that favor higher-priced brand-name drugs over less expensive options. An example highlighted in the report includes emails from Cigna employees that discouraged using cheaper alternatives to Humira, an arthritis treatment priced at $90,000 annually, while a biosimilar was available for about half that cost.
Additionally, the report points out that Express Scripts informed patients they would incur higher costs if they opted to fill prescriptions at local pharmacies rather than ordering a three-month supply through its mail-order service, thus limiting patients’ choices.
Earlier this month, the U.S. Federal Trade Commission released a similar report, stating that the six largest PBMs manage nearly 95 percent of all prescriptions in the country due to increasing vertical integration and consolidation. The FTC’s interim report expressed concern over the significant influence PBMs hold over access to and affordability of prescription medications, suggesting that these entities have conflicts of interest that may disadvantage independent pharmacies and inflate drug prices.
FTC Chair Lina M. Khan emphasized that the findings reveal that PBMs are “overcharging patients for cancer drugs,” leading to excess revenue of over $1 billion.