• by Les Luchter , July 9, 2024

Pharmacy Benefit Managers (PBMs) are “powerful middlemen [who] profit at the expense of patients and independent pharmacists,” reported the Federal Trade Commission on Tuesday as it detailed how increasing vertical integration and concentration have enabled the six largest PBMs to manage nearly 95% of all prescriptions filled in the U.S. -- and for the top three companies, over 80%.

The PBM business -- which serves as the price-setting intermediary between health insurance companies and pharmacies -- is dominated by three companies: Cigna’s Express Scripts, CVS Caremark and UnitedHealthcare’s Optum RX. The other companies in the top six are Humana Pharmacy Solutions, Blue Cross/Blue Shield’s Prime Therapeutics and independently owned MedImpact.

PBMs, declared the FTC, “hold substantial influence over independent pharmacies by imposing unfair, arbitrary, and harmful contractual terms that can impact independent pharmacies’ ability to stay in business and serve their communities. “

The timing of that report couldn’t be any better for the launch of an ad by National Community Pharmacists Association. The NCPA, hot on the heels of its recent ads equating PBMs with leeches, just debuted a CNN commercial that finds a fictional Pharmacy Benefit Manager trying unsuccessfully to explain the rationale of his job at a school class’s “Career Day.”

The Berman and Company-created spot, running nationally this week and possibly longer over CNN, highlights what the NCPA calls PBMs’ “illogical and confusing role in health care.”

To wit, as the benefit manager explains, he doesn’t make, prescribe, or provide drugs – but does decide what prescriptions patients can receive and at what price. Thus, he says with a smile, “We make more money every time the prices go up.”

“Confused about pharmacy benefit managers?” the spot concludes, “We are, too. It’s time to stop PBM greed. Visit StopDrugMiddlemen.com to learn more.”

That URL takes viewers to a site urging them to contact their U.S Senators and members of the House of Representatives to pass legislation reining in PBMs.

NCPA  provided Marketing Daily with a quick review of the pending bipartisan legislation.

One bill, which the group says would save over $1 billion by requiring fair and transparent reimbursement vis a vis Medicaid managed care, only awaits passage by the full Senate after breezing through the Finance Committee on a 26 to 1 vote. It’s already passed in the full House by a 320 to 71 vote.

Another bill, which has unanimously passed the Senate Finance Committee, includes a “No PBMs Act,” requiring the government’s Centers for Medicare & Medicaid Services to define reasonable and relevant contract terms in Medicare.

“PBMs and the massive health insurance companies that they’re affiliated with extract billions in profits from patients and pharmacies, worsening pharmacy deserts for consumers and snuffing out small businesses,” NCPA Chief Executive Officer B. Douglas Hoey said in a statement.