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Despite frequent criticism of the Federal Trade Commission (FTC), the Conservative Political Action Conference (CPAC) has announced its support for FTC efforts to rein in pharmacy benefit managers (PBMs).
“The FTC’s investigation and subsequent lawsuit regarding pharmacy benefit manager (PBM) practices would help restore a degree of desperately needed competition to our healthcare system,” said an Oct. 18 article in RealClear Policy by Andrew Langer, director of the CPAC Foundation’s Center for Regulatory Freedom and Executive Director of the Coalition Against Socialized Medicine (CASM), and David Safavian CPAC general counsel and executive vice president.
After an investigation that began in 2022, the FTC in July released an interim report outlining the need for reform.
“The FTC’s interim report lays out how dominant pharmacy benefit managers can hike the cost of drugs—including overcharging patients for cancer drugs,” FTC Chair Lina M. Khan said in July. “The report also details how PBMs can squeeze independent pharmacies that many Americans—especially those in rural communities—depend on for essential care.”
While Langer and Safavian maintained that many times over the last three years, FTC “Chair Lina Khan has engaged in fiercely ideological efforts that harm consumers more than they help,” they lauded FTC’s efforts against PBMs.
“By all appearances, the FTC investigation was thorough and not ideologically driven. Its report concluded that vertical integration and market concentration have allowed PBMs to increase drug costs,” they wrote. “Per that report, each of the largest six PBMs—which process over 90% of all drug claims—is part of vertically integrated conglomerates.”
‘PBMs have become a key part of the healthcare oligopoly’
The view that PBMs abuse their market power for profit while increasing medical costs and harming patient access has been echoed by others, including bipartisan members of Congress, according to the CPAC writers. In particular, Langer and Safavian noted the findings of a report by the House Committee on Oversight and Accountability.
“PBMs inflate prescription drug costs and interfere with patient care for their own financial benefit,” found the Oversight Committee’s report, released in July.
According to Langer and Safavian, “PBMs have become a key part of the healthcare oligopoly” due to recent legislation, including the Inflation Reduction Act (IRA), which they said was flawed policy by the Biden administration. “The IRA siphoned more than a quarter trillion dollars out of Medicare,” they complained.
In this case, the authors said they are hoping for good things from the current administration.
“We can all agree that transparency and competition improve services and lower prices. Hopefully, the FTC has taken the first step in doing just that,” they wrote.
