Story perspectives

FTC Report: PBMs Mark Up Generic Drugs 7.3 Billion

1/15/2025

46 10

Summary

FTC Exposes PBM Markups

The FTC's interim report shows the top three pharmacy benefit managers (PBMs) marked up specialty generic drugs by hundreds to thousands of percent, earning over $7.3 billion from 2017 to 2022.
Significant price hikes for drugs treating serious conditions affect patients and insurers alike.
Reform advocates stress the importance of transparency and fair pricing to combat rising drug costs in the U.S. healthcare system.

Summary

Lawmakers Demand PBM Reform

Senators Hawley and Warren, along with Representatives, urged the FTC to release a second interim report on PBMs during a January 14, 2025, hearing.
The report seeks to reveal PBM practices that inflate drug costs and negatively impact independent pharmacies.
Lawmakers advocate for the Patients Before Monopolies Act to prohibit PBM ownership of pharmacies.
Concerns persist regarding the FTC's prior reports lacking thorough economic analysis, affecting their credibility.
Bipartisan support for reform highlights increasing frustration over PBM practices limiting patient access to medications.

History

Historical Context

The FTC's report on pharmacy benefit managers (PBMs) echoes past scrutiny, notably in the late 1990s and early 2000s when PBMs faced investigations for lack of transparency and rising drug costs. The Medicare Prescription Drug, Improvement, and Modernization Act of 2003 limited government negotiation on drug prices, further entrenching PBMs' role in the healthcare system and raising ongoing concerns about drug affordability and patient access.

1 of 3

FTC Exposes PBM Markups

The FTC's interim report shows the top three pharmacy benefit managers (PBMs) marked up specialty generic drugs by hundreds to thousands of percent, earning over $7.3 billion from 2017 to 2022.
Significant price hikes for drugs treating serious conditions affect patients and insurers alike.
Reform advocates stress the importance of transparency and fair pricing to combat rising drug costs in the U.S. healthcare system.

1 / 3