Pharmacy Benefit Managers May Be Responsible for Skyrocketing Prescription Drug Costs, a “Life or Death Matter,” Says Cantwell
Seattle pharmacist who shuttered Eastlake location: “There’s obviously no way that a business could operate with these predatory and unpredictable fees.”
WASHINGTON, D.C. – Today, U.S. Senator Maria Cantwell (D-WA) held a Commerce Committee hearing on the mysterious middlemen of the prescription drug market, Pharmacy Benefit Managers (PBMs). During the hearing, Sen. Cantwell heard directly from Dr. Ryan Oftebro, owner of Seattle-area Kelley-Ross Pharmacy Group, on how PBMs used deceptive practices to overinflate the price of a generic mediation, forcing his pharmacy to pay over $538,000 in retroactive fees, which led the closure of the Eastlake Kelley-Ross Pharmacy location.
“Rising drug prices have stretched Americans’ budgets over the past decade. Nearly 3 in 10 Americans report when the cost of their medication goes up, they cut their pills in half, skip doses, or stop taking their medication,” said Sen. Cantwell at today’s hearing. “This is not the kind of healthcare choices we want people to make. The evidence suggests that PBMs are part of the high drug cost increase.”
Sen. Cantwell, who chairs the committee, recently reintroduced her bipartisan Pharmacy Benefit Manager Transparency Act. PBMs have the power to dictate how much people pay for their prescriptions, how they can access their prescriptions, and can even dictate what type of treatments people can receive. Just three PBMs control nearly 80% of the prescription drug market.
Sen. Cantwell’s legislation would increase drug pricing transparency and hold PBMs accountable for unfair and deceptive practices that drive up prescription drug costs at the expense of consumers.
Dr. Oftebro testified that PBMs increased the patient co-pay for a common generic cholesterol medication from $15 to $141 for the same 90-day supply, costing his patients an extra $500 out-of-pocket per year. The “overpayment” was then clawed back by the PBM, and not given back to the patient. Ultimately, these and other PBM fees forced the closure of the Eastlake Kelley-Ross Pharmacy location that had served the area for decades.
“There's obviously no way that a business could operate with these predatory and unpredictable fees. So, we made the difficult decision to close this location in 2022,” said Dr. Oftebro.
“These are the practices that are driving Americans crazy, and they want some transparency,” said Sen. Cantwell during the Q&A.
In June 2022, Sen. Cantwell held a roundtable discussion and press conference with Seattle-area pharmacists and patients affected by skyrocketing costs of medications to advocate for her Pharmacy Benefit Manager Transparency Act. Sen. Cantwell introduced similar legislation in 2021 to empower the FTC to conduct a study into whether PBMs provide actual value to the drug distribution chain, and whether PBMs are engaging in anticompetitive behavior leading to increased costs for consumers.
The bipartisan S. 127, Pharmacy Benefit Manager Transparency Act of 2023, was introduced by Sen. Cantwell and Sen. Chuck Grassley (R-IA), on January 27, 2023.
Video of Sen. Cantwell’s opening remarks is available HERE, audio HERE, and transcript HERE.
Video of Sen. Cantwell’s Q&A with the witnesses is available HERE, audio HERE, and transcript HERE.
Video of Seattle pharmacist Dr. Oftebro’s witness testimony is available HERE, audio HERE, and transcript HERE.
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