The Push for Fair Pricing and Reform in Pharmacy Benefit Management

Pharmacy benefit managers (PBMs) play a crucial role in shaping drug affordability and patient access, yet they face increasing scrutiny from policymakers, industry stakeholders, and the public, as discussed by experts at the annual meeting of the Academy of Managed Care Pharmacy.1

Amid growing legislative pressures and industry debates, pharmacy benefit managers (PBMs) are exploring new strategies to enhance transparency, reduce patient costs, and navigate the evolving healthcare landscape. | Image credit: MQ-Illustrations - stock.adobe.com

Juan Carlos Scott, president of the Pharmaceutical Care Management Association, opened the discussion by addressing the growing tensions in the health care landscape. He noted that rising drug prices, increasing demand for expensive treatments, and legislative pressures have created a complex environment for PBMs. Scott emphasized that PBMs serve 289 million Americans and are instrumental in securing cost savings and enhancing health care outcomes.

PBMs have faced increasing criticism for their opaque business practices, which some argue contribute to rising drug costs rather than reducing them.2 A major concern is "spread pricing," where PBMs charge health plans more for a drug than they reimburse pharmacies, pocketing the difference as profit. Additionally, PBMs negotiate rebates with drug manufacturers in exchange for favorable formulary placement, but these savings often do not reach patients, leading to higher out-of-pocket costs.

Critics also point to potential conflicts of interest, as many PBMs own mail-order and specialty pharmacies, creating an incentive to steer prescriptions toward their own businesses rather than prioritizing cost savings or patient choice. The lack of transparency in PBM revenue streams, coupled with complex pricing structures, has prompted calls for greater oversight and regulatory intervention to ensure that PBMs are truly working to lower drug costs rather than maximizing their own profits.

Scott detailed the legislative and regulatory landscape, explaining that PBMs often face misinterpretations from policymakers and competing interests from other health care stakeholders, highlighting an interaction he had with a congressional leader who confronted him about the harms of PBMs.1

“He had heard a lot from the independent pharmacy lobby that shaped his starting point and his belief. The Congressman's understanding going into our meeting was not deep, and as you all know, our issues are complex. But I'll also tell you that we stay focused, we shared facts, and by the end of the meeting, instead of saying we were the problem, he was asking, ‘What's the solution?’”

He highlighted key legislative proposals, including transparency requirements and reforms to Medicare and Medicaid, noting that these policies could significantly impact how PBMs operate. He also pointed out that state legislatures have become increasingly active in shaping pharmacy benefit policies, sometimes challenging federal preemption under the Employee Retirement Income Security Act of 1974. Scott underscored the importance of engaging with policymakers at both state and federal levels to ensure that PBMs can continue their mission of reducing costs and improving access.

Discussing innovations within the industry, Scott highlighted PBMs' efforts to lower out-of-pocket costs, improve transparency, and support the adoption of biosimilars. He pointed to the growing interest in glucagon-like peptide-1 inhibitors for weight management and diabetes, explaining that PBMs are implementing comprehensive programs to integrate these medications with patient support initiatives. He encouraged continued collaboration between PBMs and policymakers to drive further innovation in the field.

Marissa Schlaifer, vice president of policy and regulatory affairs at OptumRx, one of the largest PBMs in the US, offered additional insight into recent PBM initiatives aimed at refining pharmacy reimbursement models and eliminating administrative burdens. She announced that Optum had removed prior authorization requirements for 25% of drugs and introduced a new payment model to address disparities between brand-name and generic medication reimbursements. She also reaffirmed Optum’s commitment to passing 100% of rebates to clients by 2028, a move designed to enhance transparency and benefit patients directly.

Schlaifer addressed the issue of high list prices, acknowledging their impact on patient affordability and adherence. She highlighted Optum’s programs, including Optum Savings IQ and the critical drug affordability list, as tools to help patients manage costs. She emphasized that meaningful reform requires cooperation between PBMs, pharmaceutical manufacturers, and policymakers to promote competition and create sustainable pricing models.

Throughout the discussion, both speakers underscored the importance of transparency and collaboration across the health care supply chain. Scott pointed to competition among PBMs and the emergence of new market entrants as forces driving industry-wide improvements. Schlaifer echoed this sentiment, stressing the need for flexible benefit designs that balance premiums and out-of-pocket expenses while maintaining affordability and access.

“We need to think about partnership on lowering drug costs and making sure we’re using the right therapies and clinical solutions, like partnership with pharma companies and working on value-based arrangements… Our clients have to have the flexibility to design benefits in a way that works for them to figure out a way to afford these medications. And then [ensuring] transparency, making sure that our clients can understand why certain drugs cost more. But we all need to be focused on the patient and how to make these medications affordable, both for the patient and for our plan sponsors that have to find a way to make those drugs available for their employees,” she explained.

As the session concluded, the speakers reinforced the critical role of PBMs in navigating an evolving health care landscape. They called for ongoing innovation, policy engagement, and industry-wide collaboration to ensure that patients receive affordable, high-quality care.

Scott concluded, “When we center on the common interest of what's good for the patient, we can work together and work on how we can come through on the issue of affordability, whether it's list price, benefit design, PBM transparency and optionality, and making sure that we are making positive contributions, supporting retail pharmacy access. I think there's a road that we can find."

References

1. Schlaifer M, Scott JC. State of pharmacy benefit managers. Presented at: AMCP 2025; March 31-April 3, 2025; Houston, TX. Accessed April 2, 2025.

2. Hemphill TA. The “troubles” with pharmacy benefit managers. CATO Institute. Spring 2017. Accessed April 3, 2025. https://www.cato.org/regulation/spring-2017/troubles-pharmacy-benefit-managers