It seems the PBMs may have


become a bit too successful, how- ever. In September, the Federal Trade Commission filed a fair trade lawsuit against the three largest PBMs that it says control 80% of the market: CVS Health’s Caremark RX, Cigna’s Express Scripts, and UnitedHealth Group’s Optum. The FTC lawsuit against those


Most consumers don’t know PBMs — which are often owned by insurance companies or phar- macies — even exist.


Flashback to the 1990s and


PBMs were widely credited with helping doctors find lower-cost generic versions of brand-name drugs for their patients. But according to The Wall Street Jour- nal, over the course of the next decade or so they shifted their focus to promoting more expen- sive, brand-name drugs. Health activists suggest they do so for the same reason Willie Sutton robbed banks — because that’s where the money is. Today, those third-party op-


erators who decide which drugs will be covered at what price are extraordinarily powerful. In fact, by 2017 the top PBMs actually reported larger revenues than the pharmaceutical companies themselves. By that point, they were managing the drug benefits of over 266 million Americans. Hills says that because the PBMs get paid through “rebates” based on how much money they shave off the original price of a drug, there’s nothing PBMs love more than to work with higher priced pharmaceuticals. That’s where they make their money,


66 NEWSMAX | DECEMBER 2024


and Hills says they rarely pass along negotiated rebate savings to actual patients. The PBMs naturally want to steer consumers and their doctors toward whichever drugs earn them the highest return, and they have a number of tools to do so. One of them is requiring extensive “prior authorization” paperwork that burdens a physi- cian to “prove” the drug he or she is prescribing is really the best one for their patient. Hills tells Newsmax: “It’s not


just, ‘Have your doctor write in why you need this.’ It’s, ‘We don’t think you or your doctor know what you’re doing; we insist you do this other med first, and we might make you do several oth- ers before we’ll pay for the med that your doctor says is the right one for you.’ And so all of these utilization management tools are extremely perverse.” From her position as CEO of


StopAFib.org, Hills maintains the PBM system is “the root cause” of many of the issues patients have today. “We’re paying entirely too much for our medicines because of the PBMs,” she says. “They want to continue to pay obscene bonuses to their executives.”


three corporations and their af- filiates alleges they engaged “in anticompetitive and unfair rebat- ing practices that have artificially inflated the list price of insulin drugs, impaired patients’ access to lower list price products, and shifted the cost of high insulin list prices to vulnerable patients.” The FTC states the three


PBMs “created a perverse drug rebate system that prioritizes high rebates from drug manufactur- ers, leading to artificially inflated insulin list prices.” CVS Caremark responded that


the FTC allegations are “simply wrong.” Express Scripts, a sub- sidiary of Cigna, actually filed a lawsuit against the FTC, charg- ing its allegations in a July report were “misleading and wrong.” Cigna’s chief lawyer later stated the lawsuit reflected a “troubling pattern” of “unsubstantiated and ideologically driven attacks on


We’re paying entirely too much for our medicines because of the PBMs. They want to continue to pay obscene bonuses to their executives.” — Mellanie True Hills


EXPRESS SCRIPTS HEADQUARTERS/JHVEPHOTO/SHUTTERSTOCK


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