A new study by the Federal Trade Commission and a report issued by the House Oversight Committee have confirmed what many policymakers and health policy experts have been asserting for years: pharmacy benefit managers (PBMs) are significant contributors to the high cost of prescription medicines. The study and report detail how these PBMs generate substantial profits at the expense of patients by inflating drug costs.
The three largest PBMs—Cigna Express Scripts, CVS Caremark, and Optum RX—control nearly 80% of the market. These organizations negotiate with drug companies to determine which drugs will be covered and how much money drug companies must offer PBMs to get their drugs included in coverage plans. The amounts offered by drug companies to PBMs reach into the hundreds of billions. Subsequently, PBMs manage insurance plans for these lower-cost drugs.
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