Consumer Health Digest, Issue #24-29

July 21, 2024
  • FTC blames pharmacy benefit managers for inflating drug prices.
  • Catholic hospitals instructed to deviate from medical standards, says report.
  • Feds warn sellers of deceptive cannabinoid products.

FTC blames pharmacy benefit managers for inflating drug prices. The U.S. Federal Trade Commission (FTC) staff has concluded pharmacy benefit managers (PBMs) “wield enormous power and influence over patients’ access to drugs and the prices they pay.” This conclusion is contained in a new 73-page report that is part of the FTC’s ongoing study of how these broker companies in the pharmaceutical distribution chain exert influence over independent pharmacies by imposing contractual terms the pharmacies find “confusing, unfair, arbitrary, and harmful to their businesses.” [FTC Office of Policy Planning. Pharmacy benefit managers: The powerful middlemen inflating drug costs and squeezing main street pharmacies. Interim Staff Report, July 2024] Key insights in the report include:

  • The market for pharmacy benefit management services has become highly concentrated, and the largest PBMs are now also vertically integrated with the nation’s largest health insurers and specialty and retail pharmacies.
  • Vertically integrated PBMs may have the ability and incentive to prefer their own affiliated businesses that, in turn, can both leave unaffiliated pharmacies at a disadvantage and increase prescription drug costs.
  • The top three PBMs processed nearly 80% of the approximately 6.6 billion prescriptions dispensed by U.S. pharmacies in 2023, while the top six PBMs (Caremark Rx, LLC; Express Scripts, Inc.; OptumRx, Inc.; Humana Pharmacy Solutions, Inc.; Prime Therapeutics LLC; and MedImpact Healthcare Systems, Inc.) processed more than 90%.
  • As a result of this high degree of consolidation and vertical integration, the leading PBMs can now exercise significant power over Americans’ access to drugs and the prices they pay.
  • PBMs and brand-drug manufacturers sometimes negotiate prescription drug rebates that are expressly conditioned on limiting access to potentially lower-cost generic alternatives.

The report is preliminary. The FTC issued special orders in 2022 to the six largest PBMs to provide data and documents regarding business practices, but not all respondents replied. In a commentary about the report, business columnist Michael Hiltzik has concluded:

At the very top of the report, the FTC warns that the firms better come across “promptly,” or they’ll be taken to court. The FTC should start suing now, because the PBMs’ apparent code of silence raises a familiar question: What must they be hiding? [Hiltzik M. Pharmacy middlemen claim to keep prescription prices low. In fact, they’ve cost consumers billions. Los Angeles Times, July 11, 2024]

Catholic hospitals instructed to deviate from medical standards, says report. A KFF Health News report describes how U.S. health care is compromised by the policies of Ethical and Religious Directivesfor Catholic Health Care Services. This 2018 report prohibits or limits procedures deemed “immoral” or “intrinsically evil” by the Catholic Church’s interpretation of the Bible. [Pradhan R, Recht H. The powerful constraints on medical care in Catholic hospitals across America. KFF Health News, Feb 17, 2024] Examples include:

  • failure to offer pregnant patients whose water breaks before labor begins options that include ending the pregnancy, as per American College of Obstetricians and Gynecologists’ clinical guidelines
  • prohibiting hastening of labor for a patient experiencing a second-trimester miscarriage because the fetus has a heartbeat, thereby increasing risk of infection
  • prohibiting tubal-sterilization surgery or the referral of patients to hospitals that perform the procedure
  • banning aid in dying for terminally ill patients

The report also describes the significant impact of Catholic health systems in the United States:

  • Four of the 10 largest hospital chains (by number of beds) are Catholic, according to the Agency for Healthcare Research and Quality
  • there are “just over 600 Catholic general hospitals nationally and roughly 100 more managed by Catholic chains that place some religious limits on care”
  • nearly 800,000 people have only Catholic or Catholic-affiliated hospital options nearby
  • women often don’t know about hospitals’ affiliations with the Catholic Church or their reproductive care restrictions
  • due to liability shields under state law in 35 states, including 25 states where abortion is broadly legal, patients harmed by a hospital’s refusal to perform abortions can’t sue them

Feds warn sellers of deceptive cannabinoid products. The U.S. Food and Drug Administration (FDA) and Federal Trade Commission (FTC) have jointly ordered five companies to stop selling food products containing delta-8 THC cannabinoid in packaging designed to look like many foods that are popular among children. The letters warn that their products violated the Federal Food, Drug, and Cosmetic Act (FD&C Act) and the FTC Act’s prohibition against unfair or deceptive acts and presenedt unwarranted health or safety risks. The letters were sent to Hippy Mood; Earthly Hemps; Shamrockshrooms.com; Mary Jane’s Bakery Co. LLC; and Life Leaf Medical CBD Center. The FDA also issued a separate warning to Grow God, LLC, for the same FD&C Act violations.

In July 2023, the two agencies ordered six other companies to stop selling edible food products containing delta-8 THC with packaging that could easily be confused with foods sold by popular national brands. Those companies no longer stock such products.

Delta-8 THC is a substance found in the Cannabis sativa plant. Its psychoactive and intoxicating effects can be dangerous to consumers. It has not been evaluated or approved by the FDA for safe use in any context, including when added to food. The FDA is also concerned that delta-8 THC is being produced in ways that could result in products with harmful contaminants. In June 2022, the FDA warned consumers it had received over 125 adverse-event reports about children and adults who had consumed edible products containing delta-8 THC. Of those, 10 of the reports specifically mentioned the edible product to be a copycat of popular snack foods. Serious reported adverse events have included hallucinations, vomiting, tremor, anxiety, dizziness, confusion, and loss of consciousness. For further information, see:

Consumer Health Digest is a free weekly e-mail newsletter edited by William M. London, Ed.D., M.P.H., with help from Stephen Barrett, M.D. It summarizes scientific reports; legislative developments; enforcement actions; other news items; Web site evaluations; recommended and nonrecommended books; research tips; and other information relevant to consumer protection and consumer decision-making. The Digest’s primary focus is on health, but occasionally it includes non-health scams and practical tips. Items posted to this archive may be updated when relevant information becomes available. To subscribe, click here.


2001 || 2002 || 2003 || 2004 || 2005 || 2006 || 2007
2008 || 2009 || 2010 || 2011 || 2012 || 2013 || 2014
2015 || 2016 || 2017 || 2018 || 2019 || 2020 || 2021
2022 || 2023 || 2024 || 2025

To subscribe, click here.

< Previous Issue || Next Issue >