Patients Not PBMs Coalition Calls Attention to Recent FTC Report on How PBMs Inflate Drug Costs and Squeeze Main Street Pharmacies
Coalition releases new digital ad, “Our Moment” and video recap of recent press conference on State House steps
JULY 17, 2024 / BOSTON, MA - As Massachusetts state policymakers enter the final weeks of a two-year legislative session, the Patients Not PBMs coalition is calling attention to a recent FTC report on how pharmacy benefit managers (PBMs) profit at the expense of patients by inflating drug costs and squeezing Main Street pharmacies, and underscores the impact these middlemen have on accessibility and affordability of prescription drugs.
The interim staff report, which is part of an ongoing inquiry launched in 2022 by the FTC, details how increasing vertical integration and concentration has enabled the six largest PBMs to manage nearly 95 percent of all prescriptions filled in the United States, and allowed PBMs to profit at the expense of patients and independent pharmacists.
“The FTC’s interim report lays out how dominant pharmacy benefit managers can hike the cost of drugs—including overcharging patients for cancer drugs,” said FTC Chair Lina M. Khan. “The report also details how PBMs can squeeze independent pharmacies that many Americans—especially those in rural communities—depend on for essential care. The FTC will continue to use all our tools and authorities to scrutinize dominant players across healthcare markets and ensure that Americans can access affordable healthcare.”
The report finds that:
PBMs wield enormous power over patients’ ability to access and afford their prescription drugs, allowing PBMs to significantly influence what drugs are available and at what price.
This power can have dire consequences, with nearly 30 percent of Americans surveyed reporting rationing or even skipping doses of their prescribed medicines due to high costs
PBMs hold substantial influence over independent pharmacies by imposing unfair, arbitrary, and harmful contractual terms that can impact their ability to stay in business and serve their communities.
Patients Not PBMs, a coalition of patients, pharmacists, drug stores, and patient advocates in Massachusetts, is calling for passage of PBM reform legislation that would rein in costs and bring needed transparency to “middlemen.” On June 27, the coalition held a press conference on the steps of the State House to press for legislative action before July 31 - the end of the legislative session. Click here to watch a video recap of the press conference.
The coalition also released a digital ad, “Our Moment” which underscores the legislature’s opportunity to finally advance needed PBM reform to benefit patients and pharmacies, and continue a legacy of leading on healthcare in Massachusetts and the country.
About PBMs
PBMs are a major driver behind the high cost of prescription drugs. Acting as middlemen, PBMs use their consolidated market power to steer patients toward affiliated or preferred retail pharmacies. Over the past decade, PBMs have implemented narrow networks that incentivize or require patients to fill prescriptions at specific pharmacies that are either affiliated with the PBM or that agree to accept lower reimbursement rebates as a condition of network participation. Unfortunately, this does not mean the cost of patients’ prescriptions are lower at the preferred pharmacy; in some cases, the cash price at competing pharmacies is significantly lower than the insured price at preferred pharmacies.
Five of the six biggest PBMs are part of large, vertically integrated organizations. There is significant ownership overlap between PBMs, health insurers, specialty and mail-order pharmacies and provider organizations. Today’s “big three” PBMs – Express Scripts, CVS Caremark, and OptumRx — control over 80 percent of the market, covering roughly 180 million prescription drug customers, and are grabbing tens of billions of dollars in rebates and discounts on medicines that should be passed on to consumers.
About Patients Not PBMs Coalition
Patients Not PBMs is a coalition of organizations formed to raise awareness around how pharmacy benefit managers (PBMs), or "middlemen," are putting profits before consumers' healthcare. The coalition’s focus is to educate consumers about PBMs, and to advocate for policy actions in Massachusetts that will prevent PBMs from continuing to drive up the price of prescription drugs by taking savings away that should be passed along to consumers. Members include a broad cross-section of patient advocacy groups, pharmacists, industry and labor.
