Radar on Drug Benefits

While the federal government has already set negotiated prices for the first round of drugs subject to the Medicare Drug Price Negotiation Program, states that have the authority to set upper payment limits (UPLs) for medications are inching toward doing so — despite a variety of complications. 

On the state level, the authority to set UPLs for select drugs is wielded by prescription drug affordability boards (PDABs), which states across the country have created in recent years amid mounting frustration over rising drug costs. Not all PDABs are authorized to set UPLs, but among the five boards that do, Colorado and Maryland are the furthest along in the process. 

Some Blue Shield of California says members may not see lower drug prices in the near term under its new unbundled pharmacy care program. The insurer moved away from a single PBM approach to contract with five companies to manage various aspects of pharmacy care in an effort to create more transparency and save money for enrollees in the long run. Matt Gibbs, Blue Shield of California’s chief pharmacy officer, wrote in a Feb. 19 article that the model “won’t always mean lower prices for each specific prescription drug, at least not immediately.” The model will allow employers and members to “gain true insight” into the cost of medications and “make informed decisions in their best interests,” he wrote. But some members might see cost increases for specific medications. “A medication that once cost $1-2, for example, may now be $10-15,” Gibbs wrote. “The reality is, that medication was never truly $1 to begin with.” 

The Federal Trade Commission’s (FTC) lawsuit against the “Big Three” PBMs can move forward, a federal judge ruled. The PBMs — CVS Health Corp.’s Caremark, The Cigna Group’s Express Scripts and UnitedHealth Group’s Optum Rx — asked the court to halt the FTC’s lawsuit, claiming that it was unconstitutional. Judge Matthew Schelp of the U.S. District Court for the Eastern District of Missouri ruled that the case could proceed, stating insufficient evidence warranting an injunction at this time and that it would be “against the public’s interest.” The PBMs have appealed the ruling to the 8^th Circuit Court of Appeals. 

When it comes to how the country’s three dominant PBMs cover the blockbuster drug Humira (adalimumab) and its many biosimilars, one year has made a major difference.  

As of 2025, AbbVie’s Humira either “has or will vanish from PBMs’ standard formularies,” Drug Channels CEO Adam Fein, Ph.D., wrote in his annual post analyzing which drugs were excluded on the standard commercial formularies offered by The Cigna Group’s Express Scripts, CVS Health Corp.’s Caremark and UnitedHealth Group’s Optum Rx, as of January 2025. 

One of the most notable drugs missing from the three largest PBMs’ standard commercial formularies this year is Humira (adalimumab), AbbVie’s blockbuster drug for treating autoimmune conditions that has seen significant biosimilar competition in the U.S. since 2023.

Overall, The Cigna Group's Express Scripts removed 21 medications from its 2025 National Preferred Formulary, while CVS Health Corp.’s Caremark and UnitedHealth Group’s Optum Rx cut 16 and 12 drugs from their Standard Control Formulary and Premium Standard Formulary, respectively, according to Pharmaceutical Strategies Group’s analysis.

Despite mostly lukewarm fourth-quarter 2024 results from their parent companies, CVS Health Corp.’s Caremark, The Cigna Group’s Express Scripts and UnitedHealth Group’s Optum Rx showed strong results and optimistic outlooks for 2025. 

The CEOs of those companies also fired back at PBM criticism, stating that PBMs are crucial to negotiating and keeping drug prices low. PBMs have faced pressure from both lawmakers and the public, including administrative complaints and lawsuits aimed at alleged price fixing and claims of contributing to the opioid epidemic. Federal lawmakers have also pushed for legislation to change PBM business practices and increase transparency — and could include PBM reform measures in a budget reconciliation bill as early as March.