Light starts to shine on opaque drug pricing tactics

Late last month, the Federal Trade Commission announced it would seek public comments on the ways pharmacy benefit managers distort the prices of prescription drugs.

PBMs deserve the scrutiny, as they’re to blame for much of the rise in prescription drug costs. Insurers hire PBMs to negotiate drug prices with manufacturers and determine which medicines end up on a plan’s formulary. To guarantee their drug has a spot on the list, pharmaceutical firms routinely offer these gatekeepers deep discounts on medications. Savings on insulin, for example, can reach up to 70%.