PBMs concentrate market share across the nation: AMA

Pharmacy benefit managers (PBMs) continue consolidating their market power by integrating with health insurers, according to an analysis by the American Medical Association (AMA).

“Competition in PBM Market with Vertical Integration of Insurers with PBMs: 2025 Update,” was a Policy Research Perspectives paper by AMA Economics Director Jose R. Guardado, PhD. AMA published the 12-month in late July to examine two questions:

• Are PBM markets competitive?
• What is the extent of vertical integration between PBMs and insurers?

“These are important questions of public policy because less competition can lead to consumer harm,” the paper said.

Anyone hoping for a revelation about thriving, robust market competition may be disappointed. The AMA paper cited summer 2024 reports by the Federal Trade Commission and the U.S. House of Representatives Committee on Oversight and Accountability. Those boards concluded that the “unchecked influence of PBMs allows bad actors to inflate drug prices, limit access to necessary medications, and undermine competition.”

In a year’s time, the situation has not changed much, according to the AMA report.

“As PBMs increasingly act in their own self-interest without transparency or accountability, drug prices rise and patients face health risks from cost prohibitive drug treatments,” AMA President Bobby Mukkamala, MD, said in a news release about the report. “The AMA’s analysis is intended to provide insight to help policymakers understand the anticompetitive conditions in the PBM market that can result in harm to patients. The AMA fully supports greater transparency and accountability that is needed to prohibit PBMs from engaging in opaque and harmful business practices.”

This slideshow presents findings from the AMA review. All data come from “Competition in PBM Market with Vertical Integration of Insurers with PBMs: 2025 Update.”