WASHINGTON, DC - Energy and Commerce Committee leaders today sent a letter to the Federal Trade Commission (FTC) requesting they conduct a retrospective review of Pharmacy Benefit Manager (PBM) mergers, and how these mergers have affected prices for consumers.
The letter was signed by Energy and Commerce Committee Chairman Greg Walden (R-OR), #SubOversight Chairman Gregg Harper (R-MS), and #SubHealth Chairman Michael C. Burgess, M.D. (R-TX).
“For over a decade, there has been a significant amount of consolidation in the PBM industry. In 2016, the three largest PBMs-CVS Health Corporation/CVS Caremark, Express Scripts Holding Company, and UnitedHealthcare/Optum Rx-accounted for about 70 percent of market revenues, with the two largest PBMs accounting for nearly 52 percent of market revenues. All three of these PBMs have participated in mergers," wrote Walden, Harper, and Burgess.
The leaders continued, “Consolidation in the PBM industry is part of a larger trend of consolidation in the health care market more generally. PBMs play a significant role in the health care market and are likely to influence health care costs. There is conflicting information, however, on the impact of PBMs on health care costs for patients. For example, a February 2016 report found that PBMs help plan sponsors generate savings through a variety of different mechanisms including, but not limited to, reducing waste, negotiating rebates from drug manufacturers, negotiating discounts from drugstores, and encouraging the use of generic medicines. On the other hand, a May 2017 literature review summarized studies finding that, among other things, PBMs have used their market power to try to increase their profits and that PBMs have encouraged higher list prices for prescription drugs that increase co-pays for patients. Because some mergers may benefit patients while other mergers may harm patients, we believe it is important to closely monitor these trends."