U.S. Senator Maria Cantwell (D-Wash.), chair of the Senate Committee on Commerce, Science, and Transportation, and Sen. Chuck Grassley (R-Iowa), ranking member of the Judiciary Committee, continued their efforts to increase transparency in the prescription drug pricing market, leading a bipartisan letter to Chairwoman Lina Khan to underscore the urgency for the Federal Trade Commission (FTC) to complete its Pharmacy Benefit Managers (PBM) investigation and report its findings to Congress.
“As you know, PBMs operate with little to no transparency, making it very difficult if not impossible to understand the flow of money in the prescription drug marketplace and how PBMs determine the prices for prescription drugs,” the senators wrote. “Recent consolidations between PBMs, insurance providers, and other health care entities have resulted in vertical integration whereby a small number of companies now manage the vast majority of prescription drug benefits.”
The senators emphasized that the bipartisan Prescription Pricing for the People Act – led by Sens. Grassley and Cantwell – would require the FTC to investigate PBMs for potential market manipulation tactics and other anti-competitive practices and provide a report to Congress within one year. The bill was unanimously approved by the Judiciary Committee last year.
Earlier this year, Sens. Cantwell and Grassley introduced the Pharmacy Benefit Manager Transparency Act of 2022, which would ban deceptive and unfair pricing schemes and arbitrary clawbacks of payments made to local pharmacies. The bill would also require PBMs to report to the FTC how much money they make through spread pricing and pharmacy fees. Cantwell held a Commerce Committee hearing in May and the Committee passed the bill in June.
“There is widespread bipartisan support for examining PBMs and looking into whether they are causing Americans to pay higher prices for prescription drugs. This is why we support the FTC’s decision to conduct a PBM study. We hear stories about rising drug costs all the time,” the senators continued. “A timely study into the business practices of these intermediaries would provide transparency, insight about possible competitive harms, and inform potential legislative action. With the FTC’s action on June 7, 2022, there is widespread support for the study and interest to review its findings in a timely manner.”
Sens. Grassley and Cantwell were joined by Sens. Cindy Hyde-Smith (R-Miss.), James Lankford (R-Okla.), Marsha Blackburn (R-Tenn.), Jerry Moran (R-Kan.) and Thom Tillis (R-N.C.).
Full text of the letter is available HERE.