Overlooked Player in Opioid Epidemic: The 'Middlemen'

When making a list of the main culprits in the nation's opioid epidemic, drugmakers and greedy doctors quickly come to mind. But a New York Times investigation looks at another group whose crucial efforts "have largely escaped notice"—pharmacy benefit managers. The name sounds innocuous, but PBMs function as the drug industry's powerful "middlemen," writes Chris Hamby. In theory, they exist to reduce drug costs as they negotiate prices with pharmaceutical manufacturers on behalf of the insurers and employers who hire them.

• PBMs "exert extraordinary control over what drugs people can receive and at what price," writes Hamby. "The three dominant companies—Express Scripts, CVS Caremark and Optum Rx—oversee prescriptions for more than 200 million people and are part of health care conglomerates that sit near the top of the Fortune 500 list."

If the system were working properly in the early days of the opioid epidemic, PBMs would have been raising alarms about the vast number of pills being peddled and putting safeguards into place. Why didn't they? "Drugmakers had been paying them not to," writes Hamby. As one example, the amount paid annually by OxyContin maker Purdue Pharma to PBMs from 2003 to 2012 about doubled to $400 million. Documents reviewed by the newspaper show that PBMs repeatedly "bargained away safeguards in exchange for rebates." (Read the full investigation.)