Some companies have refuted the accusations, stating that they demonstrate a lack of understanding by the government regarding drug pricing mechanisms.
The Federal Trade Commission (FTC) has filed a lawsuit against major pharmacy benefit managers (PBMs) for allegedly manipulating the price of insulin, as announced on Sept. 20.
Three PBMs—CVS Health’s Caremark, Cigna’s Express Scripts, and United Health Group’s Optum—have been accused of “creating a perverse drug rebate system that prioritizes high rebates from drug manufacturers,” according to the FTC’s press release.
Statements from some of the PBMs mentioned in the lawsuit suggest that the government’s actions reflect a misunderstanding of how drug pricing functions.
Caremark has highlighted that it negotiates significant discounts for its clients, helping to make insulin more affordable for their members.
Both Express Scripts and Optum have countered the accusations, with the latter labeling them as baseless.
The companies stated that PBMs play a crucial role in balancing the power of pharmaceutical companies to set and increase drug prices.
Express Scripts criticized the FTC for overlooking facts and focusing on politics instead of consumer protection.
The FTC initiated an inquiry over two years ago into PBMs, seeking detailed information on their business practices.
The agency’s announcement highlighted that the price of Humalog, produced by Eli Lilly, surged by over 1,200 percent between 1999 ($21) and 2017 ($274).
Insulin pricing has become a contentious issue, with President Joe Biden proposing measures to cap insulin prices for seniors on Medicare.
Bureau of Competition Deputy Director Rahul Rao criticized insulin manufacturers, warning them about potential enforcement actions in similar cases.
The statement called out companies like Eli Lilly, Sanofi, and Novo Nordisk for inflating the list prices of their insulin products in response to PBMs’ demands for higher rebates.
Spokespeople for these manufacturers defended their companies’ practices while acknowledging the need for healthcare system reforms.
The Associated Press contributed to this report.
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