Pharmacy benefit managers (PBMs) are directing patients towards more costly medications while restricting their pharmacy options, according to a recent report from the House Committee on Oversight and Accountability.
This report, which followed a 32-month investigation, comes ahead of an upcoming hearing featuring executives from the largest PBMs. The findings were reported by the Wall Street Journal.
PBMs function as third-party administrators for prescription drug plans for health insurers, negotiating prices with pharmaceutical companies on behalf of health plans and determining patients’ out-of-pocket expenses. The three largest PBMs in the United States—Express Scripts, OptumRx, and CVS Health’s Caremark—manage about 80% of prescriptions nationwide.
The committee’s report highlighted that these PBMs have developed preferred drug lists that favor higher-priced brand-name medications over more affordable alternatives. For instance, emails from Cigna staff were referenced, discouraging the use of cheaper substitutes for Humira, an arthritis treatment that cost $90,000 annually, despite the availability of a biosimilar at half that price.
Additionally, the committee found evidence that Express Scripts informed patients they would pay more through local pharmacies than if they chose a three-month supply from their affiliated mail-order service. This practice limits options for patients regarding which pharmacy they can utilize.
Earlier this month, the U.S. Federal Trade Commission released a similar report stating that increasing consolidation has allowed the six largest PBMs to handle nearly 95% of all filled prescriptions in the country. The FTC’s findings are concerning, indicating that leading PBMs have gained significant control over Americans’ access to affordable medications. This situation fosters potential conflicts of interest, benefiting vertically integrated PBMs while disadvantaging independent pharmacies and escalating drug costs.
FTC Chair Lina M. Khan emphasized that these middlemen are “overcharging patients for cancer drugs,” resulting in over $1 billion in additional revenue for them.