Golden State Today

Julie Gill Shuffield, the executive director for the California branch of advocacy organization Patients Come First, said pharmacy benefit managers (PBMs) have been "harming the very people they are supposed to protect."

"The FTC’s interim July report on Pharmacy Benefits Managers (PBM) and their nefarious practices is sending shockwaves nationally, confirming patients’ access to affordable medications has been sacrificed through anti-competitive practices," Gill Shuffield wrote in a Mercury News letter to the editor. "What started off as middlemen negotiating drug prices has ballooned into a billion-dollar industry, with only six companies controlling nearly 95 percent of prescriptions filled in the US."

"I am thrilled to see the FTC signaling a lawsuit against the top three PBMs for driving up insulin costs and overcharging for cancer drugs," she continued. "PBMs are harming the very people they are supposed to protect.

The Federal Trade Commission (FTC) released an interim staff report on PBMs in July, which outlined how increased vertical integration and concentration have contributed to the rise of six PBMs that now manage almost 95% of the nation’s prescriptions.

A PBM is a third-party administrator of prescription drug programs for health insurers, self-insured employers, and government agencies. PBMs negotiate with drug manufacturers to secure discounts and rebates on medications, manage pharmacy networks, and process prescription drug claims. PBMs also provide services such as medication therapy management and mail-order pharmacy services.

The FTC asserts that this vertical integration and concentration have led to PBMs profiting at the expense of patients and independent pharmacists. "The FTC’s interim report lays out how dominant pharmacy benefit managers can hike the cost of drugs—including overcharging patients for cancer drugs," FTC Chair Lina M. Khan stated in the press release. 

According to the press release, PBMs influence the availability of prescription drugs and what consumers pay for them. Higher drug prices force some patients to modify how often they use a medication. The report points to a survey that shows nearly 30% of Americans ration or skip doses to manage the steep prices.

Furthermore, the report shows that PBMs command significant influence over independent pharmacies, mainly through unfair, arbitrary, and harmful contractual terms that they impose. In addition, it highlights how pharmacies affiliated with the three largest PBMs currently account for nearly 70% of all specialty drug revenue.

Gill Shuffield founded Power of 100 Sutter Buttes Basin, a charitable community women's group. She was named Woman of the Year by U.S. Rep. John Garamendi (D-Fairfield) in 2019. Gill Shuffield also previously worked as director of regulatory and government affairs at AES Corporation and in external affairs for California ISO.