FTC To Probe CVS & Other Pharmacy Benefits

The Federal Trade Commission is starting an inquiry into the operations of pharmacy benefit managers who control access to prescription drugs for millions of Americans.

The consumer protection agency said Tuesday that that it will order the nation’s largest PBMs to provide a range of information and records detailing how they do business.

Pharmacy benefit managers run prescription drug coverage for big clients that include health insurers and employers that provide coverage. They help decide which drugs make a plan’s formulary, or list of covered medications. They also can determine where patients go to fill their prescriptions.

Read More: PBMs: The Middlemen Who Drive up Drug Costs

These businesses, the biggest of which are run by companies that also operate health insurers, have been criticized by doctors and patients over their formularies and other concerns about drug access. While their intended purpose is to help insurers secure lower costs for drugs and medication, their effects on consumers have come under increasing scrutiny.

“Although many people have never heard of pharmacy benefit managers, these powerful middlemen have enormous influence over the U.S. prescription drug system,” FTC Chair Lina M. Khan said in a statement.

“This study will shine a light on these companies’ practices and their impact on pharmacies, payers, doctors, and patients,” Khan said. The FTC will be issuing the orders under Section 6(b) of the FTC Act, which gives the Commission the power to call for studies on a wide range of issues without a specific law enforcement purpose. The companies will have 90 days from the date they receive the order to respond.

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