HYDE-SMITH, COLLEAGUES URGE FTC TO COMPLETE INVESTIGATION OF PHARMACY BENEFIT MANAGERS
Lawmakers Seek Commitment to Finish Probe into Schemes Linked to High Prescription Drug Costs
WASHINGTON, D.C. – U.S. Senator Cindy Hyde-Smith (R-Miss.) is part of a bipartisan effort to ensure the Federal Trade Commission completes an investigation of pharmacy benefit managers (PBMs) for potential market manipulation tactics and other anticompetitive practices that increase the cost of prescription drugs.
Seven lawmakers, led by U.S. Senators Charles Grassley (R-Iowa) and Maria Cantwell (D-Wash.), signed a letter to FTC Chair Lina Khan asking her to commit to a timeline for its investigation of PBMs, an agency inquiry launched in June following pressure from Congress regarding insulin price concerns.
“As you know, PBMs operate with little to no transparency, making it very difficult if not impossible to understand the flow of money in the prescription drug marketplace and how PBMs determine the prices for prescription drugs. Recent consolidations between PBMs, insurance providers, and other health care entities have resulted in vertical integration whereby a small number of companies now manage the vast majority of prescription drug benefits,” the Senators wrote.
“There is widespread bipartisan support for examining PBMs and looking into whether they are causing Americans to pay higher prices for prescription drugs. This is why we support the FTC’s decision to conduct a PBM study. We hear stories about rising drug costs all the time. A timely study into the business practices of these intermediaries would provide transparency, insight about possible competitive harms, and inform potential legislative action,” the Senators continued.
On the legislative front, Hyde-Smith this summer cosponsored the Pharmacy Benefit Manager Transparency Act (S.4293) to direct the FTC to increase drug-pricing transparency and hold PBMs accountable for unfair and deceptive practices. The bill is supported by the National Community Pharmacists Association, American Pharmacists Association, and others.
Formed in the 1960s to process claims and negotiate lower drug prices with drug makers, PBMs today manage every aspect of the prescription drug benefits process for health insurance companies, self-insured employers, unions, and government programs—largely operating out of the view of regulators and consumers. In addition, more than 75 percent of the prescription drug market is now controlled by just three PBMs.
U.S. Senators James Lankford (R-Okla.), Marsha Blackburn (R-Tenn.), Jerry Moran (R-Kan.), and Thom Tillis (R-N.C.) also signed the letter to Kahn.
Read the full letter here.