A recent report from the House Committee on Oversight and Accountability asserts that pharmacy-benefit managers (PBMs) are directing patients toward more expensive medications while restricting their pharmacy options. This report, reviewed by the Wall Street Journal, is part of a lengthy 32-month investigation leading up to a hearing involving executives from the country’s largest PBMs.
PBMs act as intermediaries for prescription drug plans between health insurers and pharmaceutical companies, negotiating drug prices on behalf of health plans while also determining patients’ out-of-pocket costs.
The three largest PBMs in the United States—Express Scripts, UnitedHealth Group’s OptumRx, and CVS Health’s Caremark—manage roughly 80% of all prescriptions filled in the country. The committee’s findings indicate that these PBMs tend to favor high-priced brand-name medications over more affordable alternatives on their preferred drug lists.
One highlighted example in the report involves emails from Cigna workers advising against using less expensive alternatives to Humira, a treatment for arthritis that originally cost patients $90,000 annually, despite the availability of biosimilars priced at half that amount.
Additionally, the committee pointed out that Express Scripts informed patients they would incur higher costs if they filled prescriptions at their local pharmacies compared to obtaining a three-month supply from its affiliated mail-order pharmacy, thereby narrowing their pharmacy choices.
Earlier this month, the U.S. Federal Trade Commission (FTC) released a similar report, indicating that growing vertical integration within the industry has enabled the six largest PBMs to oversee nearly 95% of all prescriptions in the U.S. This concentration of power raises concerns about patient access to affordable medications, as stated by the FTC.
The FTC’s findings are alarming, highlighting how leading PBMs exert significant influence over the availability and affordability of prescription drugs for Americans. The agency noted that vertically integrated PBMs may prioritize their affiliated businesses, creating potential conflicts of interest and increasing drug costs for patients, while FTC Chair Lina M. Khan stated that these middlemen are reportedly “overcharging patients for cancer drugs,” leading to excess revenues exceeding $1 billion.