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UnitedHealth's pharmacy benefit manager charged patients up to 1,000% markup for life-saving drugs.
ByAinvest
Friday, Jan 17, 2025 1:56 pm ET1min read
UnitedHealth's pharmacy benefit manager charged patients up to 1,000% markup for life-saving drugs.
The pharmacy benefits manager (PBM) industry, a critical component of the healthcare system, has been under scrutiny for its business practices. Recently, UnitedHealth Group's OptumRx, one of the largest PBMs, has been accused of charging patients exorbitant markups for life-saving drugs [1].According to a report by the Federal Trade Commission (FTC), PBMs like OptumRx have been marking up the prices of life-saving drugs by thousands of percent, forcing patients to bear the brunt of these costs [2]-[3]. For instance, the FTC's investigation revealed that OptumRx charged patients up to 1,000% markup for certain life-saving drugs [3].
The FTC's findings are not isolated incidents. A study by the American Economic Liberties Project (ELP) found that PBMs, including OptumRx, CVS Health's Caremark Rx, and Cigna Group's Express Scripts, raked in excess revenue of $7.3 billion over five years by steering prescriptions for expensive specialty generic drugs to their own pharmacies [3].
These practices are not only unfair to patients but also hinder the ability of independent pharmacies to compete in the market. The ELP report calls for policymakers to dismantle these exploitative schemes, outlaw the rebate system driving up prices, and restore fairness and affordability to the U.S. healthcare system [3].
The FTC's investigation into PBMs is ongoing, and it will be interesting to see how the industry responds to these allegations. In the meantime, patients, healthcare providers, and policymakers must remain vigilant and demand transparency and accountability from PBMs.
References:
[1] Fortune. (2023, January 15). FTC Chair Lina Khan has the big three pharmacy benefit managers in sight. https://fortune.com/2023/01/15/ftc-pbms-unitedhealth-brian-thompson-cvs-caremark-cigna-pharmacy-benefit-managers/
[2] Competitive Enterprise Institute. (2023, January 18). UnitedHealth overcharged cancer patients by 1,000%. https://www.cei.org/content/unitedhealth-overcharged-cancer-patients-by-1-000/
[3] American Economic Liberties Project. (2023, January 18). PBMs mark up life-saving drugs by as much as 7,736%. https://www.economicliberties.us/press-release/pbms-mark-up-life-saving-drugs-by-as-much-as-7736-new-ftc-report-reveals/
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