FTC Says CVS, Cigna and UnitedHealth Abuse Middleman Role

 Units of CVS Health Corp., Cigna Group and UnitedHealth Group Inc. charged significantly more than the national average acquisition cost for dozens of specialty generic drugs, bringing in more than $7.3 billion in “excess” revenue over six years, the Federal Trade Commission said in a report on the drug middlemen.The practice inflated costs for consumers and insurers on key treatments for cancer, multiple sclerosis, HIV, organ transplants and other conditions and procedures, the FTC said. The report demonstrates how pharmacy benefit managers influence every aspect of the pharmaceutical supply chain, an FTC official said at a press briefing on the report Tuesday.

The report comes as the FTC is preparing to file a lawsuit alleging the three companies failed to fully comply with the agency’s subpoenas, according to people familiar with the plans. The suit, to be filed in federal court, seeks an order compelling the companies to turn over additional information about their business practices, according to the people, who spoke anonymously to discuss the complaint.

CVS said it has complied with the FTC’s demands by providing more than 2 million documents and 7 terabytes of data. A company spokesman said the lawsuit appeared to be linked to CVS’ attempt to have commissioners of the FTC removed from a related case about insulin costs. CVS said it was “misleading” for the agency to draw conclusions based on “outliers” without evaluating broader drug spending patterns.

Cigna’s Express Scripts called the report “another set of misleading conclusions based on a subset of medications that represent less than 2% of what our health plans spend on medications in a year” and said the FTC had failed to address the underlying causes of rising drug prices.

UnitedHealth’s Optum unit said the company is lowering the cost of specialty medications and helped patients save $1.3 billion in 2024, with a typical out-of-pocket payment of $5.

Two-Year Probe

The interim report, the product of a more than two-year inquiry by the antitrust and consumer protection agency, is its second looking at pharmacy benefit managers — the middlemen that negotiate drug prices between manufacturers, pharmacies and insurers. An interim report released last summer found that between 2020 and 2022, similar conduct related to two cancer drugs led to $1.6 billion in excess revenue for the pharmacies that share owners with the three largest PBMs. The agency hasn’t issued a final report because it says the companies haven’t turned over all the information it has requested.

https://finance.yahoo.com/news/ftc-says-cvs-cigna-unitedhealth-195626349.html