ATAP Condemns PBM Industry Practices Highlighted in Latest FTC Report
Urges Congress to Take Action to Reform the Prescription Drug Marketplace
[Washington, DC] [January 15, 2025] -- The Alliance of Transparent and Affordable Prescriptions (ATAP), a coalition of more than 20 patient advocacy, medical professional and healthcare organizations committed to addressing prescription drug affordability, expresses deep concern over findings from the Federal Trade Commission's (FTC) second interim staff report on Pharmacy Benefit Managers (PBMs). The report exposes how PBMs manipulate prices and extract exorbitant profits by inflating the costs of specialty generic drugs, including life-saving medications for cancer and other critical conditions.
“The FTC’s findings confirm what patients, physicians, and advocates have long suspected—PBMs are exploiting their control over the prescription drug supply chain to drive up costs at the expense of patient health and financial stability,” said Dr. Robert Levin, President of ATAP. “It is unacceptable that the very entities claiming to manage prescription drug benefits are instead profiting massively from hidden markups, leaving patients to suffer under the weight of unaffordable medications.”
The FTC report details how the three largest PBMs—CVS Caremark, Express Scripts, and OptumRx—engaged in practices that generated over $7.3 billion in revenue from 2017 to 2022 through price markups on specialty generics. The report further reveals:
Massive Markups: PBMs imposed price increases of hundreds and even thousands of percent on specialty generic drugs, including treatments for cancer, HIV, and heart disease, significantly inflating healthcare costs.
Self-Dealing and Steering: PBMs reimbursed their own affiliated specialty pharmacies at higher rates than independent pharmacies, creating unfair competition and steering profits to their parent companies.
Spread Pricing Abuses: PBMs charged plan sponsors more than they paid pharmacies, reaping $1.4 billion in additional income.
“PBMs have turned essential medications into profit centers, pushing patients to make impossible choices between life-saving treatments and financial ruin,” said Dr. Levin. “The FTC’s investigation makes it clear that we need immediate legislative action to break the cycle of price manipulation and restore transparency and fairness to the prescription drug market.”
ATAP calls on Congress to enact comprehensive reforms that:
Secure actual savings for patients by passing manufacturer rebates directly on to patients
“De-link” PBM compensation from the price of drugs to protect patients from PBM predatory pricing.
Increase transparency by mandating full disclosure of PBM pricing practices and rebate structures.
Ban spread pricing and require direct pass-through of manufacturer rebates to patients.
Prohibit anti-competitive self-dealing that favors PBM-owned pharmacies over independent competitors.
“Patients deserve a system where their health comes first—not a system rigged to enrich middlemen,” Dr. Levin continued. “By decoupling PBM profits from drug prices, policymakers can ensure that cost savings are passed on to those who need it most. It’s time for Congress to hold PBMs accountable and implement the meaningful reforms this broken market desperately needs.”
ATAP remains committed to collaborating with lawmakers, regulators, and stakeholders to drive policies that prioritize patient access and affordability.
About ATAP
ATAP was created in 2017 with a mission to address prescription drugs costs and patient access to affordable treatment by regulating PBM practices and reforming the drug industry through educational outreach and grassroots advocacy initiatives at both the state and federal levels. Driven by the reality that many patients struggle to afford their medications, the physician and patient advocacy organizations joined to shine a light on the abusive practices of PBMs.
To schedule an interview with an ATAP spokesperson please contact Dan Rene at 202-329-8357 or dan@danrene.com.
Please visit http://www.atapadvocates.com