A new report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are directing patients toward more costly medications while restricting their choices regarding where to obtain them.
This report, which was shared with the Wall Street Journal, comes after a 32-month investigation in anticipation of an upcoming hearing featuring executives from the largest PBMs in the United States.
PBMs, which are third-party administrators for prescription drug plans associated with health insurers, negotiate with pharmaceutical firms to determine the pricing for medications under health plans. They also establish the out-of-pocket expenses that patients must pay.
The three largest PBMs—Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark—collectively oversee around 80% of all prescriptions filled in the U.S.
The committee’s findings indicate that these managers have constructed lists of favored drugs that primarily include higher-priced brand-name medications, sidelining less expensive alternatives. For instance, the report highlights emails from Cigna employees discouraging the selection of cheaper substitutes for Humira, a drug for arthritis and other autoimmune diseases, which was priced at $90,000 annually when a biosimilar option costing half that amount was available.
Additionally, the committee noted that Express Scripts informed patients they would incur higher costs filling a prescription at local pharmacies compared to sourcing a three-month supply from its affiliated mail-order service. This practice appears to restrict patients’ pharmacy choices.
Earlier this month, the U.S. Federal Trade Commission (FTC) released a similar report, indicating that increased consolidation has allowed the six largest PBMs to control nearly 95% of all prescriptions in the country.
The FTC expressed concern over these developments, stating that “the leading PBMs now exercise significant power over Americans’ ability to access and afford their prescription drugs.” They pointed out that the vertically integrated PBMs possess the means and motivation to favor their affiliated businesses, which presents conflicts of interest that could harm independent pharmacies and inflate drug prices.
FTC Chair Lina M. Khan remarked that the investigation has unveiled evidence of these intermediaries “overcharging patients for cancer drugs,” which has led to additional revenue exceeding $1 billion.