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One challenge for opponents of the big pharmacy benefit managers is that a long, widely publicized Federal Trade Commission report attacking the big PBMs is not very good, according to two antitrust policy watchers at the Competitive Enterprise Institute.
Jessica Melugin and Alex Reinauer, technology policy analysts at the center, contend in a new commentary that the FTC Bureau of Economics showed that six big PBMs handled about 23% of prescriptions sold in the United States in 2023.
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But the bureau did not show that the big PBMs have the market power to reduce the supply of drugs and push up prices, Melugin and Reinauer write.
The FTC ended up relying heavily on news articles and anonymous complaints to allege that the big PBMs were driving up prices, but they did not make much use of information provided by the PBMs or the 1,200 public comments they received on the matter to make that case, the analysts add.
Dennis Carlton, a University of Chicago economist, looked at the same PBM data the FTC reviewed and found that PBMs pass most of the rebates they negotiate with manufacturers along to employer health plan sponsors, are not favoring brand-name drugs over generics, are not killing off independent pharmacies and are not responsible for the high cost of drugs, according to the analysts.
Related: In defense of pharmacy benefit managers' rebate strategies
The Competitive Enterprise Institute is a think tank, or independent research center, that says it is "dedicated to advancing the principles of limited government, free enterprise, and individual liberty."
In the past, it has been popular with conservative Republicans.
It has often defended companies involved in sectors such as the tobacco industry and coal mining.
Some institute analysts have had close ties to Republican presidential administrations. In 2016, for example, Myron Ebell, an institute environmental and energy policy analyst, led the Trump transition team for the Environmental Protection Agency.
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Allison Bell
Allison Bell, a senior reporter at ThinkAdvisor and BenefitsPRO, previously was an associate editor at National Underwriter Life & Health. She has a bachelor's degree in economics from Washington University in St. Louis and a master's degree in journalism from the Medill School of Journalism at Northwestern University. She can be reached through X at @Think_Allison.
