Legislation, FTC interim report: Positive progress in the fight for PBM reform

With an industry in transition and a healthcare landscape dominated by the “Big 3” Pharmacy Benefit Managers (PBMs) that control 90% of the market, Steven C. Anderson, FASAE, CAE, IOM, knows the importance of advocacy at the state and federal levels.

“We have helped pass 150 new laws in the last three years,” said Anderson, president and CEO of the National Association of Chain Drug Stores (NACDS). “We are working with Capitol Hill on this issue and at the regulatory level [level].“ He spoke to Pharmaceutical topics during the NACDS Total Store Expo 2024, which will be held August 17-19, 2024 in Boston, Massachusetts.

READ MORE: In July, PBMs found themselves in the federal government's hot seat

Anderson says PBMs are forcing pharmacies to accept contracts that he calls “untenable.” “PBMs have been hiding behind this complexity – the opacity – of the industry, behind people's lack of understanding, and now people are starting to understand it.”

He also spoke about the Federal Trade Commission's (FTC) investigation into PBM practices. The ongoing investigation began in 2022, and the agency released a 71-page interim report on July 9, 2024. In it, the FTC outlined the ways in which the “Big 3” PBMs – a group that includes CVS Caremark, Optum Rx, and Express Scripts – operate in ways that harm the sickest patients and squeeze out small competitors.¹ On July 23, executives from the Big 3 were called before the House Oversight and Accountability Committee to answer questions from a bipartisan group of lawmakers about rising drug costs, anti-competitive practices and licensing requirements. These lawmakers, Anderson said, have begun to understand PBMs on a level they didn't understand before. “Try explaining to a member of Congress what a direct and indirect reimbursement fee is and what a PBM is… Now they get it.”

“Their understanding is getting deeper, their voices are getting louder, their eyes are lighting up, and they are saying, 'We are going to fix this because it is not good for our country,'” Anderson said.

Want to catch up on the rest of our conference coverage? Click here to read more about our coverage of NACDS Total Store Expo 2024.

reference

1. Caffrey M. In July, PBMs came under federal scrutiny. Drug issues. August 5, 2024. Accessed August 19, 2024.