Federall Trade Commission Sues Pharmacy Benefit Managers fo Price Collusion

The @FEDERAL TRADE (FTC) has filed a complaint against the three largest pharmacy benefit managers (PBMs)—CVS Caremark, Express Scripts by Evernorth, and Optum Rx—for inflating insulin prices and restricting access to affordable medications.

Key Allegations in Complaint:

▶ PBMs Inflated Insulin Prices: Caremark, Express Scripts, and OptumRx created a rebate system prioritizing high list prices, causing insulin prices to soar. According to the FTC, these PBMs "systematically excluded" lower-cost insulins in favor of higher-priced options to "drink down the tasty…rebates."

▶ Patients Pay the Price: Vulnerable patients, particularly those with deductibles or coinsurance, were forced to pay more out of pocket. “Millions of Americans with diabetes need insulin to survive, yet their insulin drug costs have skyrocketed…thanks in part to powerful PBMs and their greed,” said Rahul Rao, FTC Deputy Director.

▶ Artificial Price Inflation: The average list price of insulin skyrocketed from $21 in 1999 to over $274 by 2017. The FTC accuses the PBMs of driving this increase through their "chase-the-rebate strategy."

▶ Exclusion of Lower-Priced Insulins: Despite more affordable insulin options, the PBMs blocked them from formularies, prioritizing products with higher rebates. The FTC alleges this behavior "forced patients to pay more for life-saving medication."

▶ The FTC aims to end these exploitative practices. “Caremark, ESI, and Optum…have extracted millions of dollars off the backs of patients who need life-saving medications," said Rao. The FTC's action is a step towards "fixing a broken system" and restoring competition to lower consumer drug prices.

 

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