Source: United States Senator for Arkansas – John Boozman
WASHINGTON – The Senate Committee on Commerce, Science and Transportation passed the bipartisan Pharmacy Benefit Manager Transparency Act, legislation to increase transparency in prescription drug pricing and hold Pharmacy Benefit Managers (PBMs) accountable for deceptive and unfair practices that drive up prescription drug costs. The bill was approved 18-9 and now heads to the full Senate.
U.S. Senator John Boozman (R-AR) cosponsored the measure shortly after it was introduced by committee chair Maria Cantwell (D-WA) and Sen. Chuck Grassley (R-IA). According to a preliminary estimate by the Congressional Budget Office, the bill would reduce the federal deficit by $740 million over the next 10 years.
“Prescription drug prices can make or break a family’s budget, especially during inflationary periods where costs for many essentials are incredibly high. I’m proud this bipartisan effort to keep prescriptions affordable and save taxpayers money is building momentum, and I encourage my colleagues to help us approve it in the Senate and send it to the House for immediate consideration,” Boozman said.
“This bipartisan bill would not only put a stop to deceptive and opaque pricing schemes that burden consumers with higher prices, it also saves taxpayers $740 million. It’s a win-win, and warrants swift approval in Congress,” Grassley said.
“Drug prices have been increasing at an alarming rate and are compromising consumers, their budgets and the cost of health plans. Pharmacy Benefit Managers are middlemen in the drug pricing supply chain and today, three PBMs control 80% of the prescription drug market, operating out of the view of regulators,” said Cantwell. “This committee has heard testimony showing how PBMs’ substantial market power and opaque practices impact patients, providers and pharmacies, including a Seattle pharmacist who had to close a pharmacy serving retirees because the PBM had clawed back over $538,000 in just a single year. So, I look forward to moving this out of committee again.”
While PBMs were initially formed to process claims and negotiate lower drug prices with drug makers, today they administer prescription drug plans for hundreds of millions of Americans and three PBMs control nearly 80 percent of the prescription drug market. They serve as middlemen, managing every aspect of the prescription drug benefits process for health insurance companies, self-insured employers, unions and government programs. They operate out of the view of regulators and consumers – setting prescription costs, deciding what drugs are covered by insurance plans and how they are dispensed – pocketing unknown sums that might otherwise be passed along as savings to consumers and undercutting local independent pharmacies. This lack of transparency makes it impossible to fully understand if and how PBMs might be manipulating the prescription drug market to increase profits and drive-up drug costs for consumers.
The bipartisan bill is also cosponsored by Sens. Jon Tester (D-MT), Cindy Hyde-Smith (R-MS), Mike Braun (R-IN), Jerry Moran (R-KS), Thom Tillis (R-NC), Shelley Moore Capito (R-WV) and Peter Welch (D-VT).
The Pharmacy Benefit Manager Transparency Act has been endorsed by the AIDS Healthcare Foundation, American Academy of Dermatology Association, American Medical Association, American Pharmacists Association, Association for Clinical Oncology, Association of Mature American Citizens, Autoimmune Association, Biotechnology Innovation Organization, Crohn’s & Colitis Foundation, Community Oncology Alliance, National Community Pharmacists Association, National Association of Manufacturers, National Consumers League, PBM Accountability Project and Ryan White Clinics for 340B Access.
Boozman is also a cosponsor of Grassley’s Prescription Pricing for the People Act of 2023, a bill to help provide better transparency of the PBM industry by examining the effects of consolidation on pricing and other potentially abusive behavior. Specifically, the legislation directs the FTC to issue a report evaluating PBM practices and provide policy or legislative recommendations to Congress on improving transparency, preventing anticompetitive behavior and ensuring consumers benefit from any cost savings. The Prescription Pricing for the People Act of 2023 passed the Senate Judiciary Committee in March of this year.