A new report from the House Committee on Oversight and Accountability reveals that pharmacy benefit managers (PBMs) are directing patients toward higher-priced medications while restricting their pharmacy choices. This report follows a 32-month investigation and will precede a hearing with executives from the nation’s largest PBMs.
PBMs are third-party administrators for prescription drug plans provided by health insurers, responsible for negotiating drug prices and establishing patient out-of-pocket costs. The three largest PBMs—Express Scripts, OptumRx (part of UnitedHealth Group), and Caremark (part of CVS Health)—handle about 80% of prescriptions in the United States.
According to the report cited by the Wall Street Journal, PBMs maintain lists of preferred drugs that prioritize more expensive brand-name medications over less costly alternatives. For instance, emails from Cigna staff discouraged using cheaper alternatives to Humira, a medication for arthritis and other autoimmune conditions that had a price tag of $90,000 annually at that time, despite the availability of a biosimilar for approximately half that cost.
The committee also noted that Express Scripts informed patients they would face higher costs at local pharmacies compared to purchasing a three-month supply through its affiliated mail-order service, thereby limiting patient options.
In a related report, the U.S. Federal Trade Commission (FTC) highlighted that the largest six PBMs now manage nearly 95% of all prescriptions filled in the country. The FTC’s findings indicated serious concerns about the power these PBMs hold over patients’ access to affordable medications. It underscored that vertically integrated PBMs may favor their affiliated businesses, which can harm independent pharmacies and drive up drug costs.
FTC Chair Lina M. Khan remarked that the findings indicate these intermediaries are charging patients excessively for cancer medications, resulting in additional revenues exceeding $1 billion.