FTC Insulin Price-Fixing Case Against PBMs Hits Roadblock: Administrative Proceedings Suspended

The Federal Trade Commission (FTC) has temporarily halted its antitrust case against the nation's largest pharmacy benefit managers (PBMs) following recent political maneuvers that left the agency without a quorum to proceed. This pause in the proceedings comes after President Donald Trump fired two Democratic commissioners, leaving the FTC without enough members to continue the case against CVS Caremark, Express Scripts, and OptumRx. The FTC's administrative action aimed to address allegations that these PBMs manipulated the pharmaceutical market, leading to inflated insulin prices for patients.

Background: The FTC's Case Against PBMs

On September 20, 2024, the FTC officially filed an administrative complaint against the three largest PBMs in the U.S., accusing them of engaging in anticompetitive practices. The complaint alleged that these PBMs exploited a flawed drug rebate system, which prioritized high rebates over patient affordability, artificially inflating the price of insulin by up to 1,200% over two decades[1][5]. This drastic price hike has left many diabetes patients facing financial hardship, with one out of every four unable to afford their medication as of 2019[5].

Key Allegations

Rebate System Manipulation: The FTC claimed that PBMs used rebates from drug manufacturers to rig competition in their favor, benefiting financially while harming patients.
Insulin Price Increases: From 1999 to 2017, the list price of Eli Lilly's brand-name insulin rose from $21 to over $274, highlighting the significant impact of these practices[5].
Exclusion of Affordable Alternatives: The PBMs were accused of excluding lower-priced insulins to favor high-rebate, high-list-price products[5].

Cause for the Stay

The recent firings of FTC Commissioners Rebecca Kelly Slaughter and Alvaro Bedoya by President Trump left the agency short-handed. Both Republican commissioners, Melissa Holyoak and Andrew Ferguson, recused themselves from the case, citing undisclosed reasons[3][5]. This lack of participation from multiple commissioners resulted in a quorum crisis, forcing the FTC to seek an expedited stay under FTC Rule 0.7(b), allowing for proceedings to continue in the absence of a full commission if all parties agree[1].

Implications and Future Developments

Despite the temporary halt, there are indications that the FTC may soon reinitiate its action. Chairman Andrew Ferguson recently changed

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