FTC to investigate the Impact of PBM's practices

Pharmacy Benefit Managers (PBMs) and other middle men have been blamed, particularly by pharmaceutical companies operating in the American market, for the high drug prices in the USA. So, it will be interesting to see what a government agency inquiry into their activities come up with.

Yesterday, the US Federal Trade Commission (FTC) announced it is soliciting public input on the ways that practices by large, vertically integrated Pharmacy Benefit Managers are affecting drug affordability and access. The  Request for Information covers a wide range of issues in the PBM market, including contract terms, rebates, fees, pricing policies, steering methods, conflicts of interest, and consolidation. The agency seeks information on these practices and their impact on patients, physicians, employers, independent and chain pharmacies, and other businesses across the distribution system.

PBMs are companies that manage prescription drug benefits on behalf of private health insurers, Medicare Part D drug plans, large employers, and other payers. The largest PBMs are vertically integrated with health insurance companies and specialty pharmacies, giving them financial incentives to steer patients to use their affiliated services. Moreover, in response to  the Commission’s request for public input on contracts terms that may harm fair competition, many independent pharmacies commented that PBM contractual terms are confusing, unfair, opaque, and arbitrary.