The Federal Trade Commission (FTC) released an interim report. report It shows how pharmacy benefit managers (PBMs) are “inflating drug costs and squeezing Main Street pharmacies to make profits at the expense of patients.”
According to the FTC, these middlemen who handle prescription drug benefits for health insurers, employers and others drive up drug prices and put pressure on independent pharmacies.
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According to the report, six large companies fill nearly 90% of prescriptions in the U.S. These companies have a lot of power, which allows them to charge high drug prices and make it difficult for patients to afford them. As a result, about 30% of Americans report skipping or skimping on medication.
FTC Chairman Lina M. Khan said in a statement about the report, “This report details how PBMs squeeze the independent pharmacies that many Americans, especially those in rural areas, rely on for basic health care. The FTC will continue to use all of its tools and authority to scrutinize major players across the health care market and ensure Americans have access to affordable health care.”
Mark Cuban, the billionaire entrepreneur and owner of the Dallas Mavericks, was quick to respond to the FTC’s findings. TweetHe expressed no surprise.
“Is anyone surprised by this? Tell this to every CEO, CFO and HR person you know. If you’re a shareholder or a Wall Street analyst, ask your portfolio companies who their PBMs are. It’s not whether they’re being ripped off, but how much they’re being ripped off. This is a question you should be asking at every quarterly earnings call: ‘How much more revenue can you add by switching to a pass-through PBM?'”
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of FTC investigation The policy was launched in 2022 and targeted large PBMs such as Caremark Rx, Express Scripts, and OptumRx. According to the report, the top three PBMs processed nearly 80% of the 6.6 billion prescriptions filled in 2023, while the top six PBMs processed more than 90%. According to the report, these large companies have merged and consolidated, so they now have significant control over whether Americans can access and afford their prescription drugs.
Additionally, PBMs are said to tend to favor pharmacies, which can drive up patient drug costs. Independent pharmacies are held to unclear and unfavorable contract terms, making it difficult for them to compete. PBMs and pharmaceutical companies also charge higher rebates from brand-name drugs, which can exclude cheaper generic versions.
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Mark Cuban’s Interests
In January 2022, Mark Cuban founded his own pharmacy, Mark Cuban Cost Plus Drug Co. The goal of his pharmacy is to provide affordable medications. Cutting out the middleman They partner with companies like pharmacy benefit managers (PBMs) to provide lower and more transparent prices for medications.
Knowing his background, it’s no wonder he’s so interested in this FTC report: His pharmacy’s mission is to make medicines more affordable, and he wants to draw attention to these unfair practices and encourage companies and investors to ask tough questions about how PBMs are affecting drug costs.
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This article FTC report finds that while drug middlemen make profits, patients pay the price. Mark Cuban’s take: “Is anyone surprised by this?” Originally Benzinga
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