PBM Reform Bill Boosting FTC Powers Takes a Step Forward

Legislation aimed at curbing several pharmacy benefit manager (PBM) practices such as spread pricing cleared a key obstacle to passage in the Senate last week. The Senate Committee on Commerce advanced 19-9 the Pharmacy Benefit Manager Transparency Act on Wednesday to the full Senate. The package is the latest bid by Congress and the federal government to ramp up scrutiny of the industry. “Pharmacy benefit managers [are] a middleman in the drug pricing supply chain,” said Sen. Maria Cantwell, D-Washington, the lead sponsor of the legislation alongside Sen. Chuck Grassley, R-Iowa. “Today, three PBMs control 80% of the prescription drug market, operating out of the view of regulators and consumers.” The legislation would prohibit several PBM practices such as reducing or clawing back reimbursement payments to pharmacies and charging pharmacies more to offset federal reimbursements. It would also prohibit the use of spread pricing, wherein a PBM will reimburse pharmacies at one price for a product and the health plan for another.