A new report from the House Committee on Oversight and Accountability reveals that pharmacy-benefit managers (PBMs) are directing patients towards more expensive medications and restricting their choices for pharmacies. This follows a 32-month investigation by the committee, which precedes a hearing with executives from the largest PBMs in the country.
PBMs, which act as intermediaries for prescription drug plans offered by health insurers, negotiate prices with pharmaceutical companies and set out-of-pocket costs for patients. The three largest PBMs in the United States—Express Scripts, OptumRx (a division of UnitedHealth Group), and Caremark (owned by CVS Health)—control around 80% of the nation’s prescriptions.
According to the report, PBMs have formulated lists of preferred medications that often favor higher-priced branded drugs over less expensive alternatives. For instance, emails from Cigna staff were cited in the report that recommended against using cheaper alternatives to Humira, an arthritis treatment costing up to $90,000 annually, despite the availability of a biosimilar at half that cost.
The investigation also highlighted instances in which Express Scripts informed patients that they would incur greater costs by filling prescriptions at local pharmacies compared to obtaining a three-month supply through its affiliated mail-order service. This practice has been criticized for restricting patients’ pharmacy options.
Earlier this month, the U.S. Federal Trade Commission released a similar report indicating that increased consolidation among PBMs has led to the largest six companies managing approximately 95% of all prescriptions filled in the U.S. The FTC expressed concern over the significant influence PBMs hold over patients’ access to affordable medications, suggesting that the vertically integrated systems create conflicts of interest that may hurt unaffiliated pharmacies and drive up drug costs.
FTC Chair Lina M. Khan commented on the findings, indicating that PBMs are overpricing cancer medications, resulting in additional revenues exceeding $1 billion for these intermediaries.