Pharmacy Benefit Companies Are More Valuable Now Than Ever

JC Scott
4 min readJun 26, 2024


A lot of ink has been spilled on the topic of prescription drug prices and how Congress can address out-of-pocket costs for Americans. Unfortunately, much of the narrative has been shaped by incomplete press reports and over-simplified talking points that wrongly point the finger at pharmacy benefit companies (PBMs).

The core mission of PBMs is to ensure that patients have affordable access to the drugs they need, which means driving down costs for the health care system. Because of the savings that PBMs secure for patients and plan sponsors — including employers, labor unions, and health insurers — drug companies who want to be paid more for their products and pharmacies that want to be paid more for their services are funding self-interested attacks on the PBM industry.

Pharmacy benefit companies are under attack simply because of the critically important role they play as the only stakeholder dedicated to lowering drug costs.

Amid the current fever-pitch narrative, policymakers are considering deeply harmful ideas that would increase costs for patients. Look no further than pharma’s so-called “delinking” proposal, the result of which would be more money in the pockets of drug companies and far lower discounts for patients and plan sponsors like employers and unions.

As policymakers evaluate pending policy proposals, I would encourage them to ask some key questions:

First, what are you trying to solve for? If the goal is lower drug prices, promotion of a healthy pharmacy market, and lower out-of-pocket costs for patients, “delinking” does not achieve those goals. Respected economists from the University of Chicago, USC Schaeffer Center, and Jack Kemp Foundation all agree that the policy would only increase costs.

Second, is the market already moving in the right direction? And would policymaking limit market innovation instead of encouraging it? Yes and yes.

Innovation in pharmacy benefits is a story that has not been told enough in the din of the current environment. In the last year alone, we have seen encouraging innovation in the PBM marketplace:

· Competition: The PBM market is only getting more competitive, with more than 70 companies offering pharmacy benefit services. New entrants are winning business and major clients are switching their PBMs, sometimes in headline grabbing ways, demonstrating the strength of competition and the numerous choices available for employers. Diversity of PBMs allows them to offer benefit design and contracting options that fit the unique needs of health plan sponsors — options they overwhelmingly value.

· Out-of-Pocket Costs: In light of rising drug prices, PBMs are actively working with clients to find ways to lower the amount that patients pay out of pocket for prescription drugs, including encouraging clients to use rebates to help keep benefits affordable. While new, adjacent businesses are offering cash-pay pharmacy options to patients, recent research shows that for the vast majority of prescription drugs, patients pay less by having and using their health insurance.

· GLP-1 Medications for Weight Loss: Employers are grappling with pharma’s extreme price setting on weight loss drugs with list prices ranging from $1,060 to $1,350 per month, combined with high patient demand. Fortunately, PBMs are responding by deploying their ability to negotiate discounts to bring down the cost of those treatments to help make them more affordable for employers to cover, and creating programs to give employers options to make sure the right patients are getting access to these treatments with services that will help to maximize the chances of long-term treatment success.

· Biosimilars: Now that pharma’s patent walls are finally starting to crack, biosimilars options are entering the market to compete against high-priced biologic products, starting with Humira, in the pharmacy space. PBMs are moving aggressively to promote those biosimilar options and leveraging that competition to bring down costs.

· Pharmacy Experience: Evolving consumer demand for how people want to get their drugs is driving innovation, from new market entrants offering digital experiences, to extended hours that better match busy schedules. PBMs continue to advocate for pharmacists to practice at the top of their license, which both better serves patients and opens new revenue streams. Further, many PBMs are implementing programs to support pharmacies in rural areas where access to healthcare can be a challenge. This comes as all the largest PBMs have announced new cost-plus pharmacy contracting options to give pharmacies greater predictability on reimbursements.

The PBM market consistently shows itself to be dynamic, competitive, and ready to adapt to evolving needs from patients and plan sponsors. Alongside these innovations, PBMs are offering new options for reporting to give clients even greater access to data and information to help them make good choices for the patients they represent. That nimbleness is more important than ever now, as the challenge of dealing with high-priced drugs shows no sign of slowing and pharma continues to come up with new ways to charge more for drugs.

Policymakers have an opportunity to deliver what patients really need when it comes to prescription drugs — lower costs and better access. By rejecting the bait from self-interested stakeholders that only want to increase their profits, and instead encouraging the market to continue innovating to address these needs and tailoring public policy to promote competition and build on this progress, we can work together to help patients have affordable access to the drugs they need.



JC Scott

JC Scott is the President & CEO of the Pharmaceutical Care Management Association (PCMA), the association representing America’s pharmacy benefit managers