FTC Takes Legal Action Against PBMs Over Inflated Insulin Prices

By Consumers for Quality Care, on October 9, 2024

The Federal Trade Commission (FTC) is filing an administrative complaint against the three largest pharmacy benefit managers (PBMs) over their price-negotiation tactics for critical prescription drugs, specifically insulin, according to The New York Times. The PBMs named in the complaint are UnitedHealth Group’s OptumRx, Cigna’s Express Scripts, and CVS Health’s Caremark. 

PBMs have come under increased scrutiny in recent years for inflating health care costs to maximize their profits, including by pushing consumers to buy preferred name-brand medications instead of less expensive versions. 

According to FTC official Rahul Rao, PBMs “have extracted millions of dollars off the backs of patients who need lifesaving medications.” Rao said that the agency is acting to “put an end to the big three P.B.M.s’ exploitative conduct and marks an important step in fixing a broken system — a fix that could ripple beyond the insulin market and restore healthy competition to drive down drug prices for consumers.” 

Last month, Vice President Kamala Harris signaled interest in going after PBMs, saying if she were elected President, her administration would “demand transparency from the middlemen who operate between Big Pharma and the insurance companies, who use opaque practices to raise your drug prices and profit off your need for medicine.” 

Earlier this summer, The New York Times published an investigative report into the PBM industry. They found that PBMs operate under a veil of obscurity, allowing them to exert extraordinary power over the prices of prescription drugs, claiming to save consumers money while in reality only padding their bottom lines and raising health care costs for everyone else.  

CQC urges lawmakers and regulators at all levels to hold PBMs accountable for practices that increase health care costs for consumers.