The Federal Trade Commission is suing three major drug middlemen, accusing them of inflating insulin prices and engaging in anticompetitive and unfair practices. These middlemen, known as pharmacy benefit managers (PBMs), include UnitedHealth Group’s Optum Rx, CVS Health’s Caremark, and Cigna’s Express Scripts. The lawsuit alleges that the PBMs engaged in rebate practices that artificially inflated the price of insulin, making it difficult for patients to access lower-priced options. Approximately 8 million Americans rely on insulin in the U.S.
The PBMs work with insurance companies to negotiate discounts from drug manufacturers, with the goal of saving patients money. However, the FTC claims that the PBMs prioritized high rebates from drug manufacturers, leading to the inflated prices. CVS Caremark and Cigna have denied the allegations, blaming the drug manufacturers for price hikes.
The lawsuit also implicates the PBMs’ group purchasing organizations, alleging that the system of rebates and fees benefits the PBMs and health plan sponsors at the expense of vulnerable diabetic patients. The FTC has highlighted the role of drug manufacturers, such as Eli Lilly and Novo Nordisk, in the price increases.
The National Community Pharmacists Association has supported the FTC’s lawsuit, citing the manipulation of drug coverage by PBMs and the resulting higher costs for patients, employers, and taxpayers. Lawmakers have also accused PBMs of inflating drug prices, leading to further investigations into their role in rising healthcare costs. States, including Vermont, have also filed lawsuits against PBMs for driving up drug costs.
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