A recent report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are directing patients towards more expensive medications while restricting their pharmacy options.
The report, which was reviewed by the Wall Street Journal, is the result of a 32-month investigation conducted by the committee in anticipation of a hearing that will involve executives from major PBMs in the country.
PBMs serve as third-party administrators for prescription drug plans offered by health insurers, negotiating prices with pharmaceutical companies and determining patients’ out-of-pocket costs. The three largest PBMs—Express Scripts, OptumRx (owned by UnitedHealth Group), and CVS Health’s Caremark—collectively oversee about 80% of prescriptions in the United States.
According to the committee’s findings, PBMs compile lists of preferred medications that favor higher-priced brand-name drugs over more affordable alternatives. The report highlights internal communications from Cigna that discouraged staff from recommending lower-cost options for Humira, a drug for arthritis and other autoimmune conditions that costs around $90,000 annually, even though a biosimilar option was available for about half that price.
The investigation also noted that Express Scripts informed patients they would have to pay more to fill prescriptions at their local pharmacy compared to the cost of obtaining a three-month supply through its own mail-order service, which limits patients’ choice in selecting pharmacies.
Additionally, a recent report from the U.S. Federal Trade Commission (FTC) echoed these findings, indicating that the dominance of the six largest PBMs allows them to manage nearly 95% of prescriptions filled in the nation. The FTC expressed concerns over the significant influence these PBMs exert on Americans’ access to and affordability of prescription medications, as well as the conflicts of interest arising from their affiliations with specific pharmacies, which could undermine competition and increase drug costs.
FTC Chair Lina M. Khan emphasized that these middlemen seem to be “overcharging patients for cancer drugs,” generating excess revenues exceeding $1 billion from these practices.