Why are US pharmacy benefit managers under fire?
By Ahmed Aboulenein
WASHINGTON, Sept 20 (Reuters) -The U.S. Federal Trade Commission said on Friday it was suing the country's three largest pharmacy benefit managers, accusing them of abusing their power and rigging the pharmaceutical supply chain to artificially inflate the cost of insulin.
Here is what you need to know about PBMs.
WHAT ARE PHARMACY BENEFIT MANAGERS?
Pharmacy benefit managers are companies that handle prescription drug benefits for health insurance companies, large employers, and Medicare prescription drug plans - a group often referred to as payers.
The PBMs negotiate fees and volume-based discounts, known as rebates, on behalf of payers with drugmakers and pharmacies; create lists known as formularies of medications covered by insurance plans; reimburse pharmacies by processing claims; and manage pharmacy networks. Many also operate their own mail-order pharmacies. They collect fees from payers and rebates from drugmakers.
Studies, including one from the Congressional Budget Office, show that rebates lower drug costs for the government and consumers. Other studies show a correlation between increases in a drug's list price and rising rebates for the drug.
WHO ARE THE BIG PBM PLAYERS?
Three companies controlled 79% of U.S. pharmacy benefit management in 2022, according to the data platform Statista: CVS Health's CVS.N CVS Caremark with 33%, Cigna's CI.N Express Scripts at 24%, and UnitedHealth Group's UNH.N OptumRx owns 22% of the market. The FTC's complaint says they now control 80% of the market.
The other noteworthy companies by market share are Humana Pharmacy Solutions at 8%, Prime Therapeutics at 5%, and MedImpact Healthcare Systems with 4%.
These six companies together control 96% of the PBM market.
HOW AND WHY ARE PBMs FACING INTENSE SCRUTINY?
The FTC began investigating the top PBMs and their impact on pricing and access to prescription drugs in 2022.
In an interim report on its investigation released in July, the agency said healthcare consolidation has given the companies outsized influence over prescription drug prices that could warrant regulation.
The FTC looked into the fees they charge, how they reimburse pharmacies, clawback of payments to pharmacies outside of their networks, and whether the companies steer patients to their own pharmacies. It also investigated whether benefit managers favor more expensive drugs that yield higher rebates over lower-cost alternatives.
Lawmakers have introduced about two dozen bills since last year targeting PBMs, including at least five with bipartisan support, congressional records show. Several have passed committees, but have yet to come to a vote by the broader Senate or House of Representatives.
There is bipartisan support for PBM reform, and lawmakers on both sides of the aisle heavily criticized the companies in a July hearing of the House Committee on Oversight and Accountability where PBM executives came under fire.
Separate bills aim to ban what is known as "spread pricing," a practice in which PBMs charge health plans a larger amount for a drug than they pay out to pharmacies. Some are seeking more transparency under which the companies would be required to provide more information on their non-public negotiations.
Rebates have also been a subject of proposed new government rules.
Reporting by Ahmed Aboulenein; Editing by Caroline Humer, Bill Berkrot and Aurora Ellis
Aset Berkaitan
Berita Terkini
Penafian: Entiti XM Group menyediakan perkhidmatan pelaksanaan sahaja dan akses ke Kemudahan Dagangan Atas Talian, yang membolehkan sesorang melihat dan/atau menggunakan kandungan yang ada di dalam atau melalui laman web, tidak bertujuan untuk mengubah atau memperluas, juga tidak mengubah atau mengembangkannya. Akses dan penggunaan tersebut tertakluk kepada: (i) Terma dan Syarat; (ii) Amaran Risiko; dan Penafian Penuh. Oleh itu, kandungan sedemikian disediakan tidak lebih dari sekadar maklumat umum. Terutamanya, perlu diketahui bahawa kandungan Kemudahan Dagangan Atas Talian bukan permintaan, atau tawaran untuk melakukan transaksi dalam pasaran kewangan. Berdagang dalam mana-mana pasaran kewangan melibatkan tahap risiko yang besar terhadap modal anda.
Semua bahan yang diterbitkan di Kemudahan Dagangan Atas Talian kami bertujuan hanya untuk tujuan pendidikan/maklumat dan tidak mengandungi – dan tidak boleh dianggap mengandungi nasihat kewangan, cukai pelaburan atau dagangan dan cadangan, atau rekod harga dagangan kami, atau tawaran, atau permintaan untuk suatu transaksi dalam sebarang instrumen kewangan atau promosi kewangan yang tidak diminta kepada anda.
Sebarang kandungan pihak ketiga serta kandungan yang disediakan oleh XM, seperti pendapat, berita, penyelidikan, analisis, harga, maklumat lain atau pautan ke laman web pihak ketiga yang terdapat dalam laman web ini disediakan berdasarkan "seadanya" sebagai ulasan pasaran umum dan bukanlah nasihat pelaburan. Sesuai dengan apa-apa kandungan yang ditafsir sebagai penyelidikan pelaburan, anda mestilah ambil perhatian dan menerima bahawa kandungan tersebut tidak bertujuan dan tidak sediakan berdasarkan keperluan undang-undang yang direka untuk mempromosikan penyelidikan pelaburan bebas dan oleh itu, ia dianggap sebagai komunikasi pemasaran di bawah peraturan dan undang-undang yang berkaitan. SIla pastikan bahawa anda telah membaca dan memahami Notifikasi mengenai Penyelidikan Pelaburan Bukan Bebas dan Amaran Risiko mengenai maklumat di atas yang boleh diakses di sini.
