A recent 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 pharmacy options. This report follows a 32-month investigation and precedes a hearing featuring executives from the nation’s largest PBMs.
PBMs serve as third-party administrators for prescription drug plans on behalf of health insurers. They negotiate prices with pharmaceutical companies and establish out-of-pocket costs for patients. The three largest PBMs in the United States—Express Scripts, OptumRx (a UnitedHealth Group company), and Caremark (part of CVS Health)—account for roughly 80% of prescriptions filled in the country.
The committee’s findings indicate that PBMs maintain lists of preferred medications that favor higher-priced brand-name drugs over more affordable alternatives. One example highlighted in the report involves Cigna employees discouraging the use of less expensive alternatives to Humira, a drug used for arthritis and other autoimmune conditions priced at approximately $90,000 annually, even though a biosimilar was available for half that price.
Additionally, the committee discovered that Express Scripts informed patients they would incur higher costs by filling prescriptions at local pharmacies compared to obtaining a three-month supply through their affiliated mail-order service, thus limiting patients’ pharmacy choices.
Earlier this month, the U.S. Federal Trade Commission (FTC) released a similar report, noting that the increasing consolidation among PBMs has led the six largest managers to oversee nearly 95% of prescriptions filled in the U.S.
The FTC expressed concerns over the findings, stating that these leading PBMs wield substantial influence over Americans’ access to affordable prescription medications. This situation fosters a scenario where vertically integrated PBMs tend to favor their own affiliates, potentially creating conflicts of interest that can undermine independent pharmacies and inflate drug prices.
FTC Chair Lina M. Khan remarked that the evidence indicates these intermediaries are significantly overcharging patients for cancer drugs, generating over $1 billion in additional revenue.