Warren, Hawley, Harshbarger, Auchincloss Urge FTC, at Upcoming Meeting, To Release Second Report On Prescription Drug Middlemen

Numerous state and federal investigations found prescription drug middlemen use their market dominance to overcharge taxpayers, hide profits, and squash competition.
Bipartisan letter “urge(s) FTC to issue its . . . report swiftly and continue investigating the serious effects of the (drug middleman) industry on patients, taxpayers, and independent pharmacies.”
Text of Letter (PDF)
Washington, D.C.— Senators Elizabeth Warren (D-Mass.) and Josh Hawley (R-Mo.), alongside Representatives Diana Harshbarger (R-Tenn.) and Jake Auchincloss (D-Mass.), wrote to the Federal Trade Commission (FTC) urging them to vote “yes” on releasing a second interim report on prescription drug middlemen, or pharmacy benefit managers (PBMs), at the FTC’s Open Commission Hearing on Tuesday, January 14, 2025.
“PBMs were originally created to handle the prescription drug benefit on behalf of health plans, negotiating directly with drug manufacturers and setting pharmacy networks for their contracted payers,”wrote the lawmakers. “But over the years, these once little-known middlemen have morphed into giant, vertically-integrated conglomerates that control every link in the drug coverage and delivery chain, including pharmacies and health plans.”
In fact, during President Trump’s first term, he branded PBMs as “famous middlemen” that “rip() off Medicare patients with high prescription prices.”
In June 2022, the FTC launched an inquiry into the industry, requiring the six largest PBMs – which manage nearly 95% of all prescriptions filled in the United States – to provide information on their business practices and contractual arrangements to determine their effect on the affordability of prescription drugs.
Despite delay tactics from PBMs, the FTC released an interim staff report detailing how the largest PBMs use their size to “employ lopsided and unilateral contracting practices” that force independent community pharmacies to “enter into one-sided, non-negotiable contracts with the leading PBMs.” The report also found that in some cases, these middlemen have forced patients with insurance to pay an unreasonably high out-of-pocket cost that is far beyond the true cost of their prescription drug.
The FTC’s interim report helped inform various bipartisan proposals to rein in abuses in the PBM market. For example, last month, Senators Warren and Hawley, alongside Representatives Harshbarger and Auchincloss, introduced thePatients Before Monopolies (PBM) Act, legislation to prohibit joint ownership of PBMs and pharmacies, a gross conflict of interest that enables these companies to enrich themselves at the expense of patients and independent pharmacies.
“We expect a second interim report will shine further light on the industry that will be invaluable to legislators as the policy priorities of the 119th Congress take shape,”added the lawmakers.
Senator Warren has led efforts to use every tool available to lower drug prices by reining in abuses in the prescription drug middleman and fighting Big Pharma’s anti-competitive business practices:
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