Highlights From Senate Hearing on Pharmacy Benefit Managers' Role in Drug Prices

A U.S. Senate panel grilled secretive pharmacy benefit managers in a hearing Thursday on how to bring fairness and transparency to U.S. drug pricing.

Although the bipartisan criticism was part of a growing chorus at the federal level against PBMs, the big question is: Will anything be done about it?

The question is important because the drug benefits of more than 265 million Americans are handled by PBMs, middlemen in the murky drug supply web whose other major players include pharmaceutical companies, health insurers and pharmacies.

A consumer protection subcommittee of the Senate Commerce committee met for an hour on Thursday, where it discussed such topics as PBM contracts with pharmacies and a PBM cost mechanism called “clawbacks.” Pharmaceutical representatives also offered testimony. Among the highlights: 

• The sweeping critique of PBMs came from both sides of the political aisle. Sen. Richard Blumenthal, D-Connecticut, noted the lack of transparency of PBMs, leaving no way to verify their claims they are saving consumers money. “PBMs are part of a broken drug supply chain that leads to increasing profits for drug companies, increasing profits for PBMs and increasing drug costs for patients,” he said.

The top Republican on the panel, Sen. Marsha Blackburn of Tennessee, cited reports of PBMs steering business to pharmacies that are part of the same company as the PBM; "onerous" audits of pharmacies competing with the PBM-affiliated pharmacy; and non-negotiable contracts forcing pharmacies to pay "clawbacks" to PBMs weeks or months after a prescription is filled.

Although not formally a member of the subcommittee, the Commerce Committee chair, Sen. Maria Cantwell, D-Washington, gave her view of PBMs:

The chair of the Senate Commerce Committee, Sen. Maria Cantwell, D-Washington, showed up at a subcommittee hearing Thursday to question the role of pharmacy benefit managers in Americans' high drug prices.
"These companies, who most Americans know nothing about, set drug costs, decide what drugs will be included in your (health) plan, and determine how drugs are dispensed. And these companies have abused their responsibility to protect Americans from the drug pricing crisis. …They also make a lot of money driving up the price on consumers today."

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