NBC News
The Federal Trade Commission (FTC) announced Friday that it will sue three pharmaceutical intermediaries it accuses of inflating insulin prices.
The FTC accused the so-called “Big Three” pharmacy benefit managers (PBMs) — UnitedHealth Group’s Optum Rx, CVS Health’s Caremark and Cigna’s Express Scripts — of engaging in “anticompetitive and unfair payment practices that have artificially inflated insulin drug prices, hindered patient access to lower-priced products and shifted the cost of more expensive insulin onto vulnerable patients.”
At least 8 million people in the United States rely on insulin, according to the FTC.
PBMs work with insurers to negotiate lower prices from pharmaceutical companies in exchange for including their drugs in health insurance plans, and in theory, their job is to help patients save money.
The lawsuit also named group purchasing organizations including Zinc Health Services, Ascent Health Services and Emisar Pharma Services.
The Big Three oversee about 80 percent of U.S. prescription drug plans, according to the lawsuit, which alleges they created a rebate system that prioritized deep discounts from drugmakers, leading to inflated insulin prices.
“This perverse system results in billions of dollars in rebates and commissions for PBMs and their health plan sponsor clients, but it does so at the expense of some vulnerable diabetes patients who are forced to pay far more out of pocket for these critical medications,” the FTC said in a press release.
UnitedHealth Group, CVS Health and Cigna did not immediately respond to a request for comment.
The FTC noted that insulin drugs used to be cheaper, using as an example Humalog, a drug made by Eli Lilly, which cost about $21 in 1999. In 2017, it cost $274, a result of the PBMs’ rebate system strategy, the FTC said.
“Millions of Americans with diabetes need insulin to survive, yet for many of these vulnerable patients, the cost of the drug has skyrocketed over the past decade thanks in part to powerful PBMs and their greed,” said Rahul Rao, deputy director of the FTC’s Bureau of Competition.
The blame for inflated prices lies not only with PBMs, but also with pharmaceutical companies such as Eli Lilly and Novo Nordisk, which the Commission says “should be warned” because they could also be sued in the future.
In July, during an oversight committee hearing, Democratic and Republican lawmakers blamed executives at Caremark, Express Scripts and Optum Rx for skyrocketing U.S. drug prices.
“On one side you have the PBMs claiming to drive down prescription drug prices, and on the other side you have the Federal Trade Commission, major media outlets like The New York Times and at least eight different attorneys general, Democrats and Republicans, claiming that PBMs are inflating the cost of these drugs,” said Illinois Democratic Rep. Raja Krishnamoorthi.
In March 2023, the committee launched an investigation into the role of PBMs in the rising cost of health care. And the FTC lawsuit comes as some states, most recently Vermont, have already filed lawsuits against PBMs, arguing that they drive up drug prices.
