A report from the U.S. Federal Trade Commission (FTC) reveals that the "Big 3" Pharmacy Benefit Managers (PBMs)—Caremark Rx, Express Scripts, and OptumRx—generated an additional $7.3 billion in revenue by inflating drug prices. The findings highlight alarming practices that have driven up patient costs for lifesaving medications like those for HIV, hypertension, and cancer.

Key Highlights:

1. Massive Markups on Lifesaving Drugs:

2. HIV drug Epivir was marked up 276% in 2022.

3. Cystic fibrosis drug Tobi saw a 339% markup.

4. Myfortic, used by organ transplant patients, was marked up 693%.

5. Hypertension drugs showed the highest markup at 7,736%, followed by multiple sclerosis drugs (2,435%) and cancer chemotherapies like Gleevec (4,154% for Medicare and 5,232% for commercial plans).

  2.  Tactics Employed by PBMs:

• Markups on specialty generic drugs at affiliated pharmacies.

• Steering profitable specialty drugs toward affiliated pharmacies.

• Employing "spread pricing," billing plan sponsors more than reimbursing pharmacies.

  3.  Scale of Control:

• The top three PBMs manage about 80% of all prescriptions nationwide, while the top six PBMs handle up to 95%.

Statements from Leaders or Officials:

• Lina Khan, FTC Chair:

“The FTC staff’s second interim report finds that the three major pharmacy benefit managers hiked costs for a wide range of lifesaving drugs, including medications to treat heart disease and cancer.”

• Hannah Garden-Monheit, FTC’s Office of Policy Planning Director:

“This problem is growing at an alarming rate, which means there is an urgent need for policymakers to address it.”The FTC’s findings add momentum to ongoing lawsuits against PBMs like Caremark, Express Scripts, and Optum for anticompetitive and unfair rebating practices. Policymakers are urged to act promptly to curb these practices and ensure patients gain affordable access to essential medications.