How Big FTC Settlements Can Lower Your Out-of-Pocket Drug Costs
For years, the price you pay at the pharmacy counter has been part of a complex, often invisible game played by powerful middlemen. Now, federal regulators are stepping in to change the rules.
The Federal Trade Commission (FTC) announced a landmark settlement with Express Scripts, one of the largest pharmacy benefit managers (PBMs) in the country. The settlement resolves allegations that the company raised drug prices – particularly on life-saving drugs like insulin – to boost its profits at the expense of patients.
If you get your prescriptions through Express Scripts or use a community pharmacy, here’s how this payment can lower your bills.
End of automatically inflated list prices
The core of the FTC’s complaint focused on practices that penalized patients to reward PBMs. According to regulators, Express Scripts prioritizes drugs with higher list prices because those drugs come with larger discounts from manufacturers.
When PBMs included out-of-pocket discounts, patients were often stuck paying coinsurance or deductibles based on that falsely inflated list price.
Under the new agreement, Express Scripts is barred from dropping lower-cost drugs from its standard formularies in favor of more expensive versions just to get discounts.
The move is expected to save patients up to $7 billion over the next decade by ensuring they have access to cheaper drugs that were previously blocked.
Low cost over the counter
Compensation forces a change in the way your expenses are calculated. Express Scripts must now offer plan options where your out-of-pocket costs are based on the total cost of the drug (the actual price after rebates and discounts), rather than the maximum list price.
Additionally, the agreement extends access to the Patient Assurance Program, which caps the out-of-pocket cost of insulin at $25 per month. If your plan includes an eligible insulin product, Express Scripts must now offer this cap as a standard benefit unless your plan sponsor specifically opts out.
Integration with TrumpRx
As part of the payment terms, Express Scripts is required to provide integrated access to TrumpRx, a new direct-to-consumer pricing platform.
Once the necessary regulatory framework is in place, Express Scripts should include this platform as part of its standard offering. These coverages are intended to allow patients to reach negotiated cash prices while those payments are factored into insurance deductibles and out-of-pocket costs.
Restoring international operations
The agreement also streamlines the corporate structure of Express Scripts’ supply chain. The company must also sell its Switzerland-based group purchasing organization, Ascent Health Services, to the United States.
Regulators have scrutinized offshore units for years due to concerns about transparency and tax avoidance. By bringing Ascent back to US soil, the FTC aims to bring more than $750 billion in procurement activity under stricter domestic regulatory oversight.
Development of community pharmacies
The agreement also addresses how Express Scripts works with local pharmacies. Private and community pharmacies have long complained that PBMs reimburse them at unfairly low rates while directing patients to PBM mail-order services.
The settlement requires Express Scripts to pay community pharmacies based on a clear formula: the actual cost of obtaining the drug plus the dispensing fee. This change is designed to stop the financial strain on local pharmacies and ensure they can stay in business to help you.
What happens next
This Agreement applies specifically to Express Scripts and its affiliates. However, the FTC currently has ongoing lawsuits with other major PBMs, including Caremark and OptumRx.
The deal sets an important precedent that could signal broader changes across the pharmaceutical industry, potentially unraveling the discount-driven model that has defined drug pricing for decades.
