A report by the Federal Trade Commission (FTC) has found that three major pharmacy benefit managers (PBMs), including UnitedHealth Group’s OptumRx, CVS Caremark Rx, and Express Scripts, have pocketed an extra $7.3 billion in added revenue above cost through price gouging.
The FTC allegations levelled at these PBMs claim they marked up certain drugs by thousands of percent, resulting in retail prices that could be 10 times or more the wholesale cost. For example, a generic used to treat leukemia, Imatinib, was nearly quadruple its acquisition cost.
Critics argue that this practice is largely due to the opaque manner in which markups are hidden to conceal inefficiencies and serve vested interests. Independent Vermont Sen. Bernie Sanders has been conducting Congressional hearings on the issue, citing it as a major contributor to America’s broken healthcare system.
The report also found that these PBMs had applied a markup rate of 1000% on specialty generic drugs dispensed at their affiliated pharmacies, resulting in retail prices of $110 for a drug that costs $10 wholesale. This practice has been condemned by patients and lawmakers alike.
UnitedHealth Group’s OptumRx claimed to be helping eligible patients save $1.3 billion in costs, but critics argue that this is misleading and cherry-picked data. CVS Caremark Rx also argued that the FTC was guilty of “cherry picking” its analysis, focusing on generics to mislead the public.
The allegations levelled at these PBMs come as the US continues to struggle with high healthcare costs per capita, failing to achieve comparable patient outcomes compared to European social market-based economies. The report’s findings are a further indictment of America’s broken healthcare system and highlight the need for greater transparency and accountability in the pharmaceutical industry.
Source: https://fortune.com/2025/01/15/ftc-pbms-unitedhealth-brian-thompson-cvs-caremark-cigna-pharmacy-benefit-managers