A recent report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are directing patients toward costlier medications while constraining access to them. This report comes after a comprehensive 32-month investigation and precedes a hearing featuring executives from the largest PBM firms in the United States.
PBMs operate as third-party administrators of prescription drug plans for health insurance companies, negotiating pricing with pharmaceutical firms and determining the out-of-pocket costs that patients face. The three largest PBMs—Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark—together manage around 80% of prescriptions in the U.S.
The committee’s findings indicate that PBMs have implemented lists of preferred medications that prioritize higher-priced brand-name drugs over less expensive alternatives. One example highlighted in the report involves Cigna staff emails dissuading the use of cheaper alternatives to Humira, a treatment for arthritis that cost $90,000 annually, despite the existence of a biosimilar priced at half that amount.
Additionally, the report states that Express Scripts advised patients that filling a prescription at their local pharmacy would be more expensive than obtaining a three-month supply from their affiliated mail-order service, effectively limiting patients’ pharmacy choices.
Earlier this month, a similar report from the U.S. Federal Trade Commission (FTC) indicated that the six largest PBMs control nearly 95% of all prescriptions dispensed in America due to increasing vertical integration and market concentration.
The FTC’s findings are concerning, revealing that major PBMs significantly influence Americans’ access to affordable prescription drugs. The commission warned that this situation fosters conflicts of interest, as vertically integrated PBMs may favor their own businesses over unaffiliated pharmacies, ultimately hiking prescription drug costs.
FTC Chair Lina M. Khan emphasized that the report’s findings demonstrate how these intermediaries are overcharging patients for cancer medications, resulting in over $1 billion in additional revenue for the PBMs.