The FTC Case Against PBM Rebates
About a month ago, the Wall Street Journal reported that the Federal Trade Commission (FTC) was preparing an antitrust suit against the nation’s three largest pharmaceutical benefit managers (PBMs), the intermediaries who negotiate drug prices on behalf of insurers and who manage benefits for nearly nine in 10 insured Americans.
This development followed a two-year investigation of the top six largest American PBMs, and a recent FTC interim report that suggested PBMs engage in anticompetitive practices that hike prices for patients. Those were alleged to include negotiating and accepting rebates from pharmaceutical companies to favorably place their on-brand drugs on insurer formularies—the lists of drugs that an insurer will cover—while imposing onerous conditions for the coverage of competing substitute drugs.