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UnitedHealth, Cigna and CVS accused of inflating prices of cancer, AIDS and hypertension drugs by up to 7,700%

The Federal Trade Commission said the nation's largest pharmaceutical managers reportedly raked in $7.3 billion in profits over five years through "significant" price inflation.

UnitedHealthcare en Phoenix, Arizona

UnitedHealthcare in Phoenix, ArizonaPatrick T. Fallon/AFP.

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Abiraterone is a drug for cancer patients. It is prescribed when, from the prostate, it has spread to other parts of the body. Because of the country's major pharmaceutical managers, acquiring it may have come with a 691% overcharge. Minimum. The maximum: a 2,299% overcharge.

That is according to the Federal Trade Commission (FTC) in a report on prescription drugs. It took aim at three industry giants Cigna, CVS and UnitedHealth, a company recently in the headlines because of the assassination of its CEO, Brian Thompson, allegedly at the hands of Luigi Mangione.

The study covers the cost of various drugs between 2017 and 2022. One pill for HIV, it claims, may have been overcharged by as much as 306%. One for multiple sclerosis, up to 2,435%. If it is instead of a pill, it is injectable, it could have reached a 168% increase.

The highest cost overrun: 7,736% to treat hypertension with a tadalafil pill in 2022.

"FTC staff have found that the Big 3 PBMs are charging enormous markups on dozens of lifesaving drugs," said Hannah Garden-Monheit, director of the FTC's Office of Policy Planning. She thus refers to UnitedHealth Group's OptumRx, Cigna's Express Scripts and CVS Caremark Rx.

The report also states that most of the drugs tested, high-priced drugs known as "specialty generic drugs," were dispensed at pharmacies affiliated with the three companies. These pharmacies, moreover, would have benefited from more expensive rebates than non-affiliates on almost all of the drugs analyzed.

Next steps

As VOZ reported in a first analysis of the report, the agency estimates that the Big 3 PBMs, as they are known, would have raked in profits of $7.3 billion over five years thanks to this "significant" price inflation.

Although the latest prices included in the study are from three years ago, Garden-Monheit said the problem is a live one: "We also found that this problem is growing at an alarming rate, which means there is an urgent need for policymakers to address it."

The FTC is weighing its next steps. Its chairwoman, Lina M. Khan, said they must continue to investigate and, if necessary, act to stop the illicit activities. She did not elaborate, however, on whether the agency will take legal action.

Pharmaceutical managers hit back

"How many more interim reports will it take before the FTC includes the mountain of data that refutes these few outliers?" asked CVS VP of external affairs David Whitrap in a statement picked up by Newsweek.

"We've provided terabytes of data in compliance with their requests, and virtually none of that data is reflected in this report," he protested.

A spokesman for Express Scripts countered, in words to Axios, that the report was "another set of misleading conclusions" based on drugs that make up less than 2% of what its health plans spend annually on pharmaceuticals. In September, the company sued the FTC.

Optum followed suit, denying the allegations and claiming it was working to reduce drug costs.

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