Brianna Allen, Senior Director of Public Affairs at the Pharmaceutical Research and Manufacturers of America (PhRMA), said that pharmacy benefit managers (PBMs) took $140 billion in rebates and fees in 2023. She claimed this action increased the cost of medicine for Americans and restricted patient access. The statement was made in a blog on PhRMA's website.
"PBMs took $140 billion in rebates and fees, driving up American medicine costs," said Allen, Senior Director, Public Affairs. "These PBM profits may exceed the total cost of drugs overseas. Just three PBMs control nearly 80% of the U.S. market and they dictate what medicines patients can get, what they pay and what hoops they must jump through."
Pharmacy benefit managers act as third-party administrators for prescription drug programs, negotiating discounts and rebates with manufacturers, managing pharmacy networks, and processing prescription drug claims. PBMs play a significant role in determining which medications are covered for patients. Their actions can influence drug pricing and access throughout the U.S. healthcare system.
According to a Federal Trade Commission report, the "Big 3 PBMs"—Caremark Rx, Express Scripts, and OptumRx—marked up specialty generic drugs at their affiliated pharmacies by hundreds or thousands of percent. These markups generated over $7.3 billion in revenue from 2017 to 2022 and highlighted the use of spread pricing, where PBMs keep the difference between what they charge health plans and what they reimburse pharmacies.
A 2023 analysis by Dan Crippen, former Director of the Congressional Budget Office, estimated that the 340B program reduces state and federal tax revenues by up to $17 billion annually, with the program’s total discounts reaching $70 billion last year. The analysis noted billions are lost at both the state and federal levels as a result of the program’s design.
Allen is a Senior Director on PhRMA’s Public Affairs team, focusing on Medicare, Medicaid, and access to medicines communications. She previously served as a strategic communications advisor at the Food and Drug Administration (FDA) and worked as a director at FGS Global’s healthcare team. Allen has a background in journalism, including covering federal health policy for POLITICO.
