New report on PBM exclusions of generics and biosimilars

A new report has drawn attention to the growing number of prescription drugs being excluded from commercial insurance formularies in the USA - particularly affordable generics and biosimilars - raising fresh concerns over patient access and out-of-pocket costs.

The report, published by drug distributor Cencora (NYSE: COR), found that the three largest pharmacy benefit managers (PBMs) have increased their formulary exclusions by 1,584% since 2014. On average, that amounts to a 27% increase in exclusions each year. Generics and biosimilars have become a growing target, despite offering lower-cost alternatives to brand-name drugs.

PBMs, which are often part of vertically integrated companies that include health insurers and pharmacies, may have financial incentives to favor expensive medicines with larger rebates. Critics argue that these business models distort the market and prevent patients from accessing more affordable therapies, especially when deductibles and coinsurance are based on undiscounted list prices.