PBMs Scrutinized in “Forum” by House Oversight and Reform Committee Republicans

Dec 06, 2021

Republicans on the U.S. House Committee on Oversight and Reform recently held a 2.5 hour “Forum” on the role of PBMs in pharmaceutical markets in which they clearly signaled that they find political and policy advantages in pressing the issue should they take the majority in the November 2022 elections.  All the Republican Representatives and 6 of the 7 witnesses were critical of the role and activities of PBMs.   

The Republicans on the U.S. House Committee on Oversight and Reform recently held a 2.5 hour “Forum” on the role of PBMs in pharmaceutical markets.

  • The Republicans repeatedly criticized the Democratic leadership and members of the committee for not holding a hearing and clearly signaled that they find political and policy advantages in pressing the issue should they take the majority in the November 2022 elections.
  • The event showcased and previewed Congressional concerns (which various Democrats have also expressed in recent years) regarding the roles and practices PBMs have increasingly employed in the pharmaceutical supply chain including lack of transparency; escalating direct and indirect remuneration (DIR) fees and post point of sale recoupments; spread pricing; and patient steering. While it was a Republican-only Forum, some Democrats are now taking note of PBM concerns, including Senate Finance Committee Chairman Wyden who recently wrote CMS on this topic (see link at bottom of the following press release).
  • While some members expressed concerns that the entire supply chain should be examined, wholesale distributors were only referenced as a link in the supply system.

Here is an online summary with short narrations accompanying several video clips from the Republican Committee members.

All the Republican Representatives and 6 of the 7 witnesses were critical of the role and activities of PBMs. Notably:

  • Representatives Buddy Carter (R-GA) and Diana Harshbarger (R-TN) (non-committee member guests) both pointedly criticized PBMs and stressed their first-hand knowledge from their pharmacist careers. Rep. Harshbarger said she has been waiting for over 20 years for such a “hearing.”
  • The “anti-PBM” witnesses included:
    • Antonio Ciaccia, CEO of 46Brooklyn Research with involvement in successful litigation against PBMs in Ohio, who stressed that the original, mostly administrative function of PBMs has changed to a greater capture of margin, which is unmeasurable because of lack of transparency.
    • Dr. Madeline Feldman, MD, FACR and President of the Coalition of State Rheumatology Practices and Chair of the Alliance for Safe Biologic Medicines, who presented examples of patients with low copays for expensive drugs, while cheaper generics were not on PBM formularies.
    • Ted Okon, MBA and ED of the Community Oncology Alliance (COA) who provided several examples of PBM abuses.
  • Mr. Kim Caldwell, RPh and Principal at Texas Star Healthcare Consulting, on behalf of the Pharmaceutical Care Management Association (PCMA) was the only PBM witness.  He explained the original foundational practices of PBMs with examples and posited that the egregious examples described were basically bad business practices by individual bad actors and should not be presented as an indictment of the entire PBM industry.