The Federal Trade Commission (FTC) has launched a major investigation against three of the nation’s largest pharmacy benefit managers (PBMs) for allegedly inflating insulin prices, leaving patients across the U.S. facing exorbitant costs for the life-saving medication. The targeted PBMs, CVS Health’s Caremark Rx, Cigna’s Express Scripts, and UnitedHealth Group’s OptumRx, are accused of creating a pricing system that prioritizes profit over patient care.
According to the FTC, the companies orchestrated a scheme that significantly raised the list prices for insulin by favoring higher-priced versions of the drug, in exchange for receiving large rebates from drug manufacturers. These practices, the FTC claims, have prevented lower-cost insulin products from being offered to consumers, despite their availability. The investigation reveals that the exclusion of these more affordable insulin alternatives directly resulted in patients paying unnecessarily high out-of-pocket expenses, aggravating the financial burden on those with diabetes.
FTC Chair Lina Khan has emphasized that the probe underscores the agency’s commitment to addressing anti-competitive practices within the pharmaceutical industry. “The tactics employed by these companies are not only unethical but detrimental to millions of Americans who depend on insulin for survival,” Khan said. “The FTC will continue to fight against corporations that prioritize profit at the expense of patients’ health and well-being.”
The controversy surrounding insulin prices is not new. For years, patients and advocacy groups have criticized the healthcare industry for allowing the cost of insulin—a drug discovered over 100 years ago—to surge. Many have pointed out that the high price of insulin in the U.S. often forces patients to ration their supply or seek out riskier, black-market alternatives, putting their health in jeopardy.
Health policy experts have called the FTC’s actions a long-overdue response to what they describe as predatory pricing strategies in the pharmaceutical supply chain. “These pharmacy benefit managers hold enormous sway over which drugs are included in insurance plans,” says Dr. Rebecca Larson, a healthcare economist. “By opting for higher-priced insulin due to rebates, they are driving up costs for insurers and patients alike.”
CVS Health, Cigna, and UnitedHealth Group have all denied any wrongdoing. In a joint statement, the companies assert that their pricing decisions are aimed at providing access to the best medications while keeping overall healthcare costs down. They also claim that the rebate system helps mitigate out-of-pocket expenses for many patients. However, consumer advocacy groups argue that this explanation does not justify the steep rise in insulin prices and the ongoing exclusion of cheaper alternatives.
As the FTC’s investigation progresses, patients and advocacy organizations are hopeful that greater transparency will lead to reforms in how insulin prices are set. “For far too long, the cost of insulin has been inflated by these middlemen,” says Jake Kaplan, an advocate with the Diabetes Action Network. “This investigation could be the breakthrough needed to finally hold these companies accountable and bring relief to the millions of people living with diabetes.”
Lawmakers are also watching closely, with several members of Congress expressing support for the FTC’s action. Representative Katie Porter (D-CA), known for her focus on consumer protection, applauded the investigation. “Americans should not have to choose between paying their rent or affording insulin,” she said. “It’s time to break up these monopolistic practices and ensure affordable healthcare for all.”
The outcome of the FTC’s probe could have significant implications for the future of prescription drug pricing in the U.S. If the PBMs are found guilty of price manipulation, it could trigger broader reforms in the healthcare system aimed at curbing the power of intermediaries like PBMs, ultimately leading to more affordable medications for millions of Americans.
