A recent report from the House Committee on Oversight and Accountability indicates that pharmacy-benefit managers (PBMs) are directing patients towards higher-cost medications while restricting their choices regarding pharmacies.
The report, reviewed by the Wall Street Journal, follows a 32-month investigation prior to a hearing involving executives from the country’s largest PBMs. These managers act as intermediaries for health insurers, negotiating prices with pharmaceutical companies and determining out-of-pocket costs for patients.
The three largest PBMs in the U.S.—Express Scripts, OptumRx from UnitedHealth Group, and Caremark from CVS Health—manage about 80% of all prescriptions in the country. The committee discovered that these PBMs have developed lists of preferred medications that favor more expensive brand-name drugs over cheaper alternatives.
One example highlighted in the report involves emails from Cigna, which discouraged the use of less costly alternatives to Humira, a drug for arthritis and other autoimmune disorders that costs around $90,000 annually, despite the availability of a biosimilar at half that price.
Additionally, the report noted that Express Scripts informed patients that filling a prescription at a local pharmacy would result in higher costs compared to obtaining a three-month supply through their mail-order service, limiting patient choice.
Earlier in the month, the U.S. Federal Trade Commission (FTC) published a report echoing similar concerns. The FTC stated that a combination of increased vertical integration and concentration in the market allows the six largest PBMs to control nearly 95% of all prescriptions filled in the U.S.
The FTC’s findings raised alarms about the considerable power PBMs wield over Americans’ access to and affordability of prescription drugs. Furthermore, the system seems to incentivize vertically integrated PBMs to favor their own affiliated businesses, leading to conflicts of interest that may harm independent pharmacies and drive up drug costs.
FTC Chair Lina M. Khan remarked that the findings reveal how these intermediaries are “overcharging patients for cancer drugs,” generating additional revenues exceeding $1 billion.