FTC PBM Complaint
The Pharmaceutical Benefits Manager Settlements Are a Novel Advance for the FTC and Competition Enforcement
In February, the Federal Trade Commission settled with pharmaceutical benefits manager (PBM) Express Scripts. The FTC had sued Express Scripts and two other large PBMs under the long dormant Section 5 of the FTC Act, which targets “unfair methods of competition.” The settlement suggests that the FTC may succeed in addressing the convoluted contracts between PBMs, drug manufacturers, health insurers, and employers that drive up drug prices for Americans. It also opens unchartered territory for antitrust enforcement and the limits of Section 5, argue Fiona Scott Morton and Mariah Smith.
Can the FTC’s PBM Complaint Create a Competitive Pharmaceutical Marketplace?
Fiona Scott Morton reviews the merits of the Federal Trade Commission’s complaint against the three largest pharmacy benefit managers (PBMs) for suppressing competition in pharmaceutical markets. Although the complaint’s alleged harms are narrow, it is a welcome start that promises to shed light on the PBM’s expansive anticompetitive practices and ultimately lower drug prices for Americans.
