The Federal Trade Commission on Friday indicted three Major U.S. Healthcare Companies Negotiating insulin prices, arguing that the practices used by drug middlemen increase profits while “artificially” driving up costs for patients.
The lawsuit targets three major so-called pharmacy benefit managers, UnitedHealth Group OptumRx, CVS Health care markings and Cigna Expression script. All of these organizations are owned by or affiliated with health insurance companies and together manage approximately 80% of the nation’s prescriptions, according to the FTC.
The FTC’s lawsuit also includes each PBM’s affiliated group purchasing organizations, which act as agents for drug purchases for hospitals and other health care providers. Agency says it may recommend prosecution of drug companies Eli Lilly and Company, Sanofi and Novo Nordisk The future and the role they play in driving up insulin product list prices.
A UnitedHealth spokesperson said the lawsuit “demonstrates a profound misunderstanding of how drug pricing works,” noting that Optum RX has had “active and successful” negotiations with the drug manufacturer.
A CVS spokesperson said Caremark is “proud of the work” it has done to make insulin more affordable for Americans, adding that “it would be simply wrong to suggest anything else, as the FTC did today.”
A spokesman for Express Scripts said the lawsuit “continues a disturbing pattern of unsubstantiated and ideologically driven attacks on PBMs by the FTC.” Three days ago, Express Scripts sued the FTC, asking the agency to withdraw what it called “defamatory” statements. July report Claims the PBM industry is raising drug prices.
PBMs are at the center of the U.S. drug supply chain, negotiating rebates with drug manufacturers on behalf of insurance companies, large employers and federal health plans. They also create a list of drugs or formularies covered by insurance and reimburse pharmacies for prescription drugs. The FTC has been investigating PBMs since 2022.
The agency’s lawsuit alleges that the three PBMs created an “improper” drug rebate system that prioritized high rebates from drugmakers, resulting in “artificially high insulin list prices.” It also claims that PBMs favor insulins with high sticker prices even when more affordable insulins at lower prices are available.
The FTC is filing its complaint through what’s known as an administrative proceeding, which begins proceedings before an administrative law judge hearing the case.
“Millions of Americans with diabetes need insulin to survive, but for many vulnerable patients, the cost of their insulin medications has been higher than in the past,” said Rahul Rao, deputy director of the FTC Bureau. Soared during the decade, in part because of powerful PBMs and their greed.
“The FTC’s administrative action seeks to end the exploitative practices of three major PBMs and marks an important step in repairing a broken system—a repair that could ripple beyond the insulin market and restore healthy competition that drives down consumers. drug prices,” Rao continued.
About eight million Americans with diabetes rely on insulin to survive, and many are forced to ration the treatment because of its high price, according to the Federal Trade Commission.
The Inflation Reduction Act signed by President Biden caps insulin prices for Medicare beneficiaries at $35 per month. The policy is not currently available to patients with private insurance.
With many Americans struggling to afford prescription drugs, the Biden administration and Congress have stepped up pressure on the Pharmacy Benefits Administration, seeking to make its operations more transparent. Americans pay on average two to three times more for prescription drugs than patients in other developed countries, according to one survey. Overview From the White House.
The FTC said it remains “deeply troubled” by the role insulin manufacturers played in raising list prices, believing they raised prices in response to PBM demands for higher rebates. Eli Lilly, Sanofi and Novo Nordisk control about 90% of the U.S. insulin market.
For example, Eli Lilly’s Humalog insulin had a list price of $274 in 2017, an increase of more than 1,200% from the $21 list price in 1999, according to FTC data.
The FTC said all drug manufacturers should “be aware that their participation in the conduct challenged here raises a number of concerns.”
A spokesman for Eli Lilly said the FTC’s lawsuit involves “every aspect of the U.S. health care system that we have long advocated for reform.” They added that the company last year became the first to limit out-of-pocket costs for all insulin to $35 per month for private insurance. Eli Lilly has also cut the price of some insulins by 70%.
Sanofi last year declare The most commonly used insulin has a monthly price cap of $35. Novo Nordisk also said last year that it would Significant price cuts Some of its popular insulins are down as much as 75%.
Sanofi and Novo Nordisk did not immediately respond to requests for comment.
