The actual purpose of a pharmacy benefits manager (PBM) is somewhat questionable. Their stated purpose is to mediate prescription medications prices for insurance companies. What’s interesting is the fact that over 80% of prescription drugs sold since 2012 are generic which means that most of these medications are inexpensive to begin with. What’s more, there’s no evidence that PBMs provide any real discounts to the prices of brand name medications.
What PBMs appear to be doing is extracting money simply to add an extra layer of bureaucracy to the purchase of prescription medications. Most of these medications should be inexpensive already so, what actual help is the PBM providing? They do provide mail order prescription services so that people don’t have to go to a pharmacy to pick up their medications, but that appears to be it.
There are four major corporations that derive the majority of their revenue from prescription drug sales in the United States. They are CVS Caremark, Express Scripts, Rite Aid and Walgreen. Together, these four companies sold 57% of the prescription drugs bought in the US in 2013.
I’ve completed much of my analysis of the financial records for the pharmacies and PBMs and I filed all of it in this webpage here: http://truecostofhealthcare.net/pharmacy-financial-index/
