Big pharmaceutical companies are facing a major lawsuit from the Federal Trade Commission over allegations that they are maximizing profits illegally by steering some patients to drugs that cost a lot of money.
Politico issued a report about the impending case this week, citing four different people who have direct knowledge of the discussions regarding the effort.
The case would allegedly target pharmaceutical intermediaries that are owned by Cigna, CVS and UnitedHealth Group. The claims are that these entities pushed patients to take brand-name drugs, including those for insulin.
The probes that have been conducted by lawmakers, patient advocates and federal regulators have focused on one of the middlemen’s key source of profit — the rebates that drug companies pay for certain medications to be listed on covered drugs.
Those rebates, they claim, ultimately inflate how much drugs cost.
The four sources told Politico that the lawsuit could be filed sometime this month, though a final decision on the matter hasn’t been made yet.
Either way, it’s the latest effort that seeks to target and solve rising costs of drugs throughout the U.S. In America, insurers and patients spend much more on medications than many other countries do.
In the process, the middlemen who ultimately determine what drugs get covered by insurance plans have been pointing the finger at drug manufacturers for the problem. At the same time, the drug manufacturers are pointing their fingers at the middlemen.
In the last few weeks, lawyers and executives at those three companies have met with the three FTC commissioners who are Democrat as they sought to prevent a lawsuit from being filed.
The two Republicans who serve on the FTC — Andrew Ferguson and Melissa Holyoak — are both recused from the matter since they’ve worked on similar investigations in the past. Holyoak was once the solicitor general of Utah, while Ferguson served in the same position previously in Virginia.
The FTC declined to comment on the matter when Politico reached out to a spokesperson for the agency.
Greg Lopes, who works for the Pharmaceutical Care Management Association, said they “have a proven track record of lowering prescription drug costs.”
He added that the blame for high drug prices lies with drug companies who “alone have the power to set their list prices, and they continue to set them high.”
Justine Sessions, a spokesperson for Express Scripts, also said drugmakers are to blame, noting the average prices for insulin from her company are less than $25.
Yet, a spokesperson for CVS, David Whitrap, countered:
“We will defend the use of these tools vigorously as we continue working to safeguard our clients and their members from drugmaker price gouging.”
A 71-page report was released by the FTC about the PBM industry as a whole, and it was highly critical of the players in it.
The agency has been very active in the sector recently, too, blocking potential takeovers as well as applications for exclusive licenses to develop certain drugs.
