Insulin prices increased 1,200% in 18 years because of unfair rebate practices: FTC
The Federal Trade Commission is suing the three largest prescription drug benefit managers (PBMs) for allegedly driving up insulin prices through anticompetitive and unfair rebating practices, impaired patients’ access to lower list price products, and shifted the cost of high insulin list prices to vulnerable patients.
The agency said the companies Caremark Rx, Express Scripts (ESI), and OptumRx — and their affiliated group purchasing organizations (GPOs) — abused their economic power by rigging pharmaceutical supply chain competition in their favor, forcing patients to pay more for life-saving medication.
According to the complaint, these PBMs, known as the Big Three, together administer about 80% of all prescriptions in the United States.
The FTC alleges that the three PBMs created a "perverse drug rebate system" that prioritizes high rebates from drug manufacturers, leading to artificially inflated insulin list prices.
The complaint charges that even when lower list price insulins became available, the PBMs systemically excluded them in favor of high list price, highly rebated insulin products.
These strategies have allowed the PBMs and GPOs to line their pockets while certain patients are forced to pay higher out-of-pocket costs for insulin medication, the FTC’s complaint alleges.
“Millions of Americans with diabetes need insulin to survive, yet for many of these vulnerable patients, their insulin drug costs have skyrocketed over the past decade thanks in part to powerful PBMs and their greed,” said Rahul Rao, Deputy Director of the FTC’s Bureau of Competition.
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