Topline
The Federal Trade Commission will sue three of the largest pharmacy benefit managers after the agency released a report alleging the companies—which manage roughly 80% of prescriptions in the U.S.—were driving up the prices of some medications, like insulin, while pushing customers away from cheaper alternatives.
The agency released a report alleging how pharmacy benefit managers drive up the costs of some ... [+]
Key Facts
The FTC’s lawsuit will challenge the business practices of UnitedHealth Group’s OptumRx, Cigna Group’s Express Scripts and CVS Health’s Caremark, three of the largest firms responsible for negotiating the terms and conditions for access to prescription drugs, unnamed people familiar with the matter told The Wall Street Journal.
The agency released findings from an investigation Tuesday alleging pharmacy benefit managers use various tactics to have customers choose certain drugs over others, including ranking them on lists or formularies, a list of medications provided by health insurance providers.
Some pharmacy benefit managers excluded cheaper medications on formularies in exchange for larger rebates from drugmakers, the FTC’s report alleges.
Neither Caremark, Express Scripts nor OptumRx immediately responded to requests for comment from Forbes.
Get Forbes Breaking News Text Alerts: We’re launching text message alerts so you'll always know the biggest stories shaping the day’s headlines. Text “Alerts” to (201) 335-0739 or sign up here.
Chief Critic
J.C. Scott, president and chief executive of the Pharmaceutical Care Management Association, which represents pharmacy benefit managers, criticized the report Tuesday: “This report is based on anecdotes and comments from anonymous sources and self-interested parties, and supported only by two cherry-picked case studies that are implied to be representative of the entire market.”
Surprising Fact
About 30% of Americans have reported rationing or skipping doses of their prescriptions because of rising costs, according to the FTC.
Key Background
The FTC opened an investigation into six pharmacy benefit managers in 2022, requesting the six largest companies turn over records and information about their business practices. Pharmacy benefit managers handle prescription drug benefits for health insurance firms and larger employers, and have come under increased scrutiny from lawmakers and regulators in the U.S., with FTC Chair Lina Khan referring to them as “dominant gatekeepers” that have “price gouged” Americans for medications. Ohio Attorney General David Yost filed a lawsuit against several pharmacy benefit managers last year, including Express Scripts, alleging they were illegally driving up drug prices.
