PBMs appeal FTC case over insulin costs 

Photo: Julia Burmistrova/Getty Images

After a federal judge ruled that the Federal Trade Commission’s case against pharmacy benefit managers could move forward, the PBMs have upped their claim by filing an appeal.

Express Scripts, Caremark, OptumRx and others filed their appeal Friday to the U.S. Court of Appeals for the Eighth Circuit.

They are appealing the Feb. 18 decision of the lower court in Missouri denying their motion for a preliminary injunction against the FTC’s complaint against them.

The FTC alleges anticompetitive and unfair rebating practices that artificially inflate the list price of insulin.

WHY THIS MATTERS

On Sept. 20, 2024, the FTC filed an administrative complaint against the three largest PBMs – Caremark Rx, Express Scripts and OptumRx – and their affiliated group purchasing organizations.

The FTC maintained that the PBMs systematically prefer high list price insulin products with high rebates and fees over low list products.

The PBMs filed for a preliminary injunction, saying the FTC violated the Constitution in four different ways, including that the FTC’s administrative law judge overseeing the proceeding is unlawfully insulated from removal.

Judge Matthew T. Schelp in the Eastern District of Missouri denied the motion, allowing the case to move forward. However, he said his decision did not mean that the PBMs would be unable to obtain any relief “when all is said and done.”

The PBMs failed to show a sufficient threat of irreparable harm warranting preliminary relief, Schelp said. He also cited “the balance of the equities and public interest” as a reason for the denial.

THE LARGER TREND

PBMs negotiate with drug manufacturers on what plans will pay for drugs, maintaining they secure discounts that plans pass on to patients.

However, the FTC maintained that PBMs systematically prefer high list price insulin products with high rebates and fees over low list products.

Some of them, according to FTC documents, “had unfairly created and implemented a system of rebates and exclusionary formularies that shift the cost of high insulin list prices to certain patients,” in violation of law.

Companies named in the case as respondents include Caremark, Zinc Health Services, Express Scripts, Evernorth, Medco Health Services, Ascent Health Services, OptumRx, OptumRx Holdings and Emisar Pharma Services.

Email the writer: SMorse@himss.org