UPDATE: March 19, 2019: The hearing has been rescheduled for April 9, as the previous date of April 3 conflicted with NATO Secretary General’s joint address to Congress. Four of the five companies have voluntarily agreed to have their CEOs testify. The U.S. Senate Finance Committee declined to disclose what PBM or payer was the remaining holdout.
- Bipartisan leaders of the Senate Finance Committee have invited the five biggest pharmacy benefit managers to testify next month on their role within the drug pricing system, the latest to take the hot seat on the topic.
- Cigna, CVS Caremark and CVS Health, Humana, OptumRx and Prime Therapeutics "owe patients and taxpayers an explanation of their role," Sens. Chuck Grassley, R-Iowa, and Ron Wyden, D-Oregon, said in a statement.
- The hearing, previously scheduled for April 3, follows a relatively mild meeting last month, when lawmakers questioned the CEOs of major drugmakers on their role in skyrocketing drug costs. The topic, a perennial frustration for patients, has been a frequent talking point at the White House and among potential 2020 presidential candidates.
None of the companies invited gave an immediate public response. The Senate Finance Committee said Wednesday two of them have agreed to voluntarily testify but would not specify which companies. Humana told Healthcare Dive its segment president of healthcare services, William Fleming, will testify. Prime Therapeutics confirmed its interim CEO Mike Kolar plans to attend.
If the firms follow the pharmaceutical playbook, they will agree to send top executives before the lawmakers. They may be more at ease with the idea after those CEOs escaped the hearing without being raked over the coals too harshly.
The competitive landscape for PBMs has changed dramatically in recent years, with major payers overtaking the sector. Cigna has completed its $67 billion acquisition of Express Scripts, and CVS-Aetna's Caremark and UnitedHealth's Optum round out the top three. Fourth-largest is Humana Pharmacy Solutions. Prime Therapeutics is the PBM for a group of Blue Cross Blue Shield plans.
Last month, Anthem announced it was speeding up the launch of its PBM, IngenioRx, to the second quarter of this year. Centene has been touting its PBM RxAdvance as a disruptor in the sector, although analysts aren't holding their breath.
At their hearing, drug company chiefs pointed the finger at PBMs for high costs, arguing rebates don't get passed along to patients as intended. But PBMs have pushed back against this narrative and encouraged a focus on manufacturers and the list prices they set.
The Trump administration has put forward a blueprint for containing rising drug costs, including a few provisions aimed at PBMs. One proposal would require them to act solely in the interest of whomever they are managing benefits for and also proposed requiring Medicare Part D plans to pass on rebates to consumers.
Earlier this year, HHS acted on part of the blueprint with a proposal to end safe harbor protections for drug rebates through PBMs, Medicare Part D plans and Medicaid managed care organizations. Payers responded with frustration.