Radar on Drug Benefits

UnitedHealth Group’s Optum Rx, The Cigna Group’s Express Scripts, CVS Health Corp.’s Caremark and Prime Therapeutics together control about 70% of the national PBM market in 2022, according to an American Medical Association (AMA) report released on Sept. 9.   Although the PBM industry’s trade group immediately criticized the report, pointing out that the nation’s largest physician trade group could be biased against PBMs, data from AIS Health’s parent company, MMIT, tells a similar story. And one leading health policy expert tells AIS Health that what the researchers found is “very reasonable” and consistent with other reports on the concentration and vertical integration in the PBM market.   The Pharmaceutical Care Management Association (PCMA), the PBM industry’s leading trade group, asserts that there are more than 70 full-service PBMs in the U.S.  “It’s unfair to assume the AMA presents an accurate depiction of the entire health care system,” Greg Payne, PCMA’s vice...

The Food and Drug Administration’s top gene therapy regulator issued what he acknowledged is a “provocative” call to consider setting a “target product profile” for gene therapy that includes not just what is expected from a clinical perspective, but “what we need to expect out of them from an economic perspective and from a clinical benefit perspective versus cost perspective.”

The FDA, by virtue of legal mandates and historical precedent, tends to avoid discussing the costs of novel medical interventions. But when a senior leader like Center for Biologics Evaluation and Research Director Peter Marks discusses cost-effectiveness tradeoffs, eyebrows raise.

After the chairman of a key House committee accused three top PBM executives of giving “fraudulent testimony,” one of those companies is hitting back. The heads of CVS Health Corp.’s Caremark, The Cigna Group’s Express Scripts and UnitedHealth’s Optum Rx testified before the House Committee on Oversight and Accountability on July 23 to defend their companies against skeptical lawmakers. In late August, committee Chairman James Comer (R-Ky.) sent letters to CVS’s David Joyner, Express Scripts’ Adam Kautzner and Optum Rx’s Patrick Conway, M.D., offering them an opportunity to “correct the record” regarding statements they made, such as Joyner’s assertion that Caremark pays CVS-affiliated pharmacies less than other pharmacies in its network. In a Sept. 10 letter, Caremark responded by asserting that Joyner’s testimony was “accurate and supported by comprehensive analyses of CVS Caremark’s data by an outside economist.” 

In the race between the largest PBMs to embrace — and monetize — biosimilars, UnitedHealth Group’s Optum Rx has quietly been making moves to counter its competitors’ headline-grabbing announcements. Specifically, Optum Rx next year will make Humira and Stelara biosimilars available through its new private-label drug distributor, Nuvaila, and change how its formularies treat the two drugs — echoing similar moves by CVS Health Corp. and The Cigna Group.

Echoing a proposal championed by the Biden administration, Democratic presidential candidate Kamala Harris said recently that if elected, she hopes to apply a $35 out-of-pocket cap on insulin to everyone in the country — not just those on Medicare. But newly published research into state out-of-pocket insulin cost caps raises questions about how much of an impact such a policy would make. 

So far, 25 states and Washington, D.C., have passed legislation capping patients’ monthly out-of-pocket costs for insulin, with upper thresholds set between $25 and $100. Those caps apply only to state-regulated health insurance plans. Meanwhile, the Inflation Reduction Act (IRA) capped Medicare enrollees’ monthly out-of-pocket costs for insulin at $35, effective in 2023.