PBM Reform: A System Under Pressure

PBM Reform: A System Under Pressure

The landscape of pharmacy benefit manager (PBM) reform is evolving as healthcare stakeholders grapple with rising prescription drug prices and opaque industry practices. Recent legislative and regulatory developments highlight the increasing scrutiny PBMs face and the uncertain road ahead.

Congressional Push for PBM Reform

New bills introduced in Congress aim to curb prescription drug prices by increasing transparency and accountability for PBMs. Lawmakers are calling for greater oversight to ensure that PBMs prioritize patients over profits. Key provisions in the proposed legislation include eliminating spread pricing – where PBMs charge insurers more for a drug than they reimburse pharmacies – and requiring PBMs to disclose rebate agreements with drug manufacturers. Despite bipartisan interest in PBM reform, corresponding legislation was not included in Congress’s recent funding package, delaying potential changes that could reshape the industry. This omission signals ongoing political and industry resistance to reform.

FTC Intensifies Scrutiny of PBM Practices

The Federal Trade Commission (FTC) has taken a more aggressive stance on PBM practices, with its second report delving into the operations of major players like Caremark, Express Scripts and OptumRx. The report scrutinizes how PBMs leverage their market power to control drug pricing, potentially stifling competition and limiting consumer choices. PBMs have been accused of steering patients toward higher-cost drugs that offer better rebates, rather than prioritizing lower-cost alternatives.

The FTC is also investigating the role of PBMs in pharmacy closures, particularly independent pharmacies that struggle to compete against PBM-affiliated chains. Findings from this investigation could serve as a catalyst for future regulatory actions designed to curb PBM influence and promote a more competitive pharmaceutical landscape, potentially leading to new enforcement measures or policy changes that favor transparency and consumer protection.

Legal Developments on Employer Fiduciary Responsibilities

Beyond legislative efforts, the PBM industry is under growing legal scrutiny. A Wells Fargo lawsuit underscores the fiduciary responsibilities of employers in managing prescription drug benefits, highlighting the potential financial risks associated with PBM contracts. The case has drawn attention to the opaque nature of PBM fee structures and their impact on employer-sponsored health plans.

Additionally, a recent court decision dismissed ERISA fiduciary breach claims against Johnson & Johnson, setting a precedent that may influence future legal challenges against PBMs and pharmaceutical firms. This ruling raises questions about the ability of the courts to hold industry players accountable for pricing and reimbursement practices. The legal landscape remains uncertain, with ongoing lawsuits and regulatory investigations likely to shape the future of PBM governance and employer fiduciary obligations.

Implications For Employers and Patients

With reform efforts stalling in Congress but gaining traction in legal and regulatory arenas, employers and patients must stay informed about PBM strategies that impact drug pricing. Evaluating programs that work in tandem with the pharmacy benefit may provide additional savings both for members and plans.

One example of these programs is the RxSaveCard program, which offers cost-saving alternatives for medications that may be overpriced within the PBM contract, allowing patients to access medications at more affordable rates. However, these initiatives alone cannot address the systemic issues at play. Employers must conduct thorough reviews of PBM contracts to ensure they are securing the best pricing for their employees. Additionally, greater industry transparency, employer due diligence and continued regulatory oversight will be essential in driving meaningful reform.

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Biosimilars: Past, Present and Future Trends

Biosimilars: Past, Present and Future Trends

To understand biosimilars better, let’s break down the basics — brand vs. generic medications. Generic medications are chemically synthesized to be identical to their brand-name counterparts. Unlike generics, biosimilars are complex, large molecules derived from living organisms. Because of their biological nature, exact replication isn’t possible. Instead, biosimilars are highly similar to their reference biologic, ensuring equivalent safety and efficacy.

While generics can reduce costs by 80%-90%, biosimilars provide savings, but not always to the same degree, due to higher manufacturing costs and strict regulatory oversight.

The Past: Lessons From Humira

One of the biggest developments in biosimilars last year revolved around Humira. Its rollout was highly anticipated, though market adoption varied based on different utilization management (UM) strategies:

  • Express Scripts (ESI): Initially preferred Humira, but by July 2024, it partnered with Quallent for a $0 copay via Accredo pharmacy to incentivize biosimilar For 2025, ESI is expiring continuation of therapy for Humira on June 30 and is preferring biosimilar use starting July 1.
  • CVS: Took an aggressive approach, excluding Humira in favor of biosimilars, leading to an 87% switch in therapy.
  • OptumRx: Slow start to adopt changes but later preferred Amjevita with a $0 copay and plan savings.

Looking ahead, biosimilars will replace Humira as the preferred option starting July 1, 2025.

The Present: Spotlight On Stelara

With Stelara’s patent expiration in late 2023, biosimilars are now entering the market. Unlike Humira, which faced hurdles due to variations in formulation and interchangeability concerns, Stelara’s biosimilar, Wezlana, is interchangeable — a key factor in boosting adoption.

  • Key Developments: Wezlana covers all FDA-approved indications for Stelara plus additional indications. Beyond Wezlana, additional biosimilars like Yesintek and Steqeyma are set to enter the U.S. market in 2025, offering further savings.
  • Pricing Advantage: Stelara’s retail price is estimated at $35,000 per unit, while Wezlana’s price has demonstrated a significant cost reduction, averaging around 80% lower.

ESI and Optum have taken different approaches in managing Stelara biosimilars, while CVS has yet to finalize its strategy. However, updates may arrive later in the year.

The Future: Expanding Biosimilar Adoption

Biosimilars aren’t exclusive to specialty medications — insulin biosimilars have also been making waves. Existing insulin biosimilars include Admelog (Humalog) and Semglee (Lantus), both interchangeable. Merilog, the first rapid-acting biosimilar to Novolog, received FDA approval in February 2025. This expands access to both long-acting and meal-time insulin biosimilars.

While insulin biosimilars may not yield cost savings as dramatic as specialty drugs – due to price caps and wholesale costs – they increase treatment options, accessibility and flexibility for patients. As 2025 unfolds, PBMs will continue adapting utilization management strategies for biosimilars, shaping future healthcare cost trends.

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GLP-1 Market Update – RX Pulse

GLP-1 Market Update – RX Pulse

With the recent resolution of shortages for GLP-1 medications and their removal from the FDA drug shortage list, medications like semaglutide (Ozempic, Wegovy) and tirzepatide (Mounjaro, Zepbound), the U.S. Food and Drug Administration (FDA) has ended temporary policies that allowed compounding of these drugs. State-licensed pharmacies were required to cease compounding tirzepatide by February 18, 2025, and outsourcing facilities by March 19, 2025. For semaglutide, the deadlines are April 22 and May 22, 2025, respectively. This action is intended to protect public safety by eliminating access to potentially unsafe, unapproved compounded formulations now that the commercial supply has stabilized.

GLP-1 Medicare Drug Negotiation Price List

In January 2025, the Centers for Medicare and Medicaid Services (CMS) announced the inclusion of GLP-1 receptor agonists – specifically semaglutide-based medications Ozempic, Wegovy and Rybelsus – in the second cycle of the Medicare Drug Price Negotiation Program, as per the Inflation Reduction Act.

Negotiations with manufacturers are scheduled throughout 2025, with the newly negotiated prices set to take effect in 2027. This initiative aims to reduce out-of-pocket costs for Medicare beneficiaries and address the high expenditures associated with these medications. Notably, CMS will treat all formulations of semaglutide – regardless of brand name, dosage form or approved indication – as a single product for negotiation purposes, potentially leading to more uniform and substantial price reductions across these therapies.

GLP-1 receptor agonists, widely used for managing type 2 diabetes and obesity, represented over $14 billion in Medicare Part D spending from November 2023 to October 2024, underscoring their significant financial impact on the program.

Expanded Indications and Emerging Uses For GLP-1 Receptor Agonists

As of April 2025, GLP-1 receptor agonists continue to evolve beyond their original use in type 2 diabetes and obesity management. Most notably, the FDA recently approved semaglutide (Ozempic) for reducing the risk of kidney disease progression, kidney failure and cardiovascular death in adults with type 2 diabetes and chronic kidney disease — making it the first GLP-1 to receive this indication. The approval was based on results from the FLOW trial, which showed significant renal and cardiovascular benefits (Novo Nordisk, 2025). Eli Lilly’s investigational oral GLP-1, orforglipron, is also generating significant attention. In Phase 3 trials, it demonstrated substantial weight loss and improved glycemic control in patients with type 2 diabetes. Unlike earlier oral agents, orforglipron does not require fasting and is expected to be submitted for FDA approval for weight management by the end of 2025 (Business Insider, 2025; Axios, 2025).

GLP-1s are also in development for several novel therapeutic areas. Clinical trials are evaluating their efficacy in treating non-alcoholic steatohepatitis (NASH), polycystic ovary syndrome (PCOS), and neurodegenerative conditions such as Alzheimer’s disease. Preliminary research even suggests a potential role in reducing addictive behaviors related to alcohol and substance use (NFP, 2024; BioSpace, 2025). In addition to expanded indications, pharmaceutical companies are developing next-generation therapies that combine GLP-1 activity with other mechanisms. For example, CagriSema – a combination of semaglutide and cagrilintide – has shown enhanced weight loss efficacy in clinical trials. These advances indicate a broadening scope for GLP-1 therapies across metabolic, renal, neurological and behavioral health domains.

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