Washington D.C. – Today, the American Economic Liberties Project released a comment letter commending Senators Maria Cantwell and Chuck Grassley for introducing the Pharmacy Benefit Manager Transparency Act of 2022 (the PBMTA) and offering suggestions to strengthen the legislation.

Pharmacy Benefit Managers (PBMs) are one of health care’s ultimate corporate middlemen, sitting in the middle of pharmacies, health insurance plans, drug makers, and patients. With immense control over drug prices in the United States, PBMs are responsible for many of the problems in our country’s pharmaceutical care system. The PBMTA aims to address PBMs many harms by empowering the Federal Trade Commission (FTC) to increase drug pricing transparency and hold PBMs accountable for unfair business practices that drive up the costs of prescription drugs at the expense of patients and pharmacies.

As drafted, the PBMTA will have demonstrable, immediate impacts, but there remains room to bolster the legislation. In its letter, Economic Liberties outlines four policy suggestions, encouraging policymakers to:

• Remove language requiring that claw backs or off sets by PBMs of reimbursement payments be “arbitrary, unfair, or deceptive,” thereby acknowledging the per se harm of these practices to pharmacies and patients;
• Eliminate the exception for PBMs who return price concessions to health plans, which threatens to swallow the rule against illegal claw backs and price increases, and further incentivizes consolidation of PBMs and health plans;
• Remove the affirmative defense allowing PBMs to plead that illegal claw backs and price increases were necessary to “protect patient safety or access,” which is an unreasonably vague standard and will result in barriers to enforcement against per se harmful conduct; and
• Provide pharmacies with a private right of action so that they may hold PBMs directly accountable, outside the context of years-long, under-resourced public investigations and enforcement actions.

Additional details are included in the full comment letter, available here.

Last week, Economic Liberties released a new explainer on PBMs: The Pharmacy Benefit Mafia: The Secret Health Care Monopolies Jacking Up Drug Prices and Abusing Patients and Pharmacists. Designed to catalogue the ways PBMs wield their power to exploit patients, pharmacists, doctors and our government, the brief details PBMs’ abusive business practices, their history of skirting regulation, and how the FTC’s recent efforts can put power back into the hands of patients and pharmacists.

Learn more about Economic Liberties here.

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The American Economic Liberties Project works to ensure America’s system of commerce is structured to advance, rather than undermine, economic liberty, fair commerce, and a secure, inclusive democracy. Economic Liberties believes true economic liberty means entrepreneurs and businesses large and small succeed on the merits of their ideas and hard work; commerce empowers consumers, workers, farmers, and engineers instead of subjecting them to discrimination and abuse from financiers and monopolists; foreign trade arrangements support domestic security and democracy; and wealth is broadly distributed to support equitable political power.