UnitedHealth, rival shares fall as lawmakers push to eliminate drug middlemen

Shares of companies owned by pharmacy benefit managers fell Wednesday after a bipartisan bill was introduced that would force health insurers or drug intermediaries to sell their pharmacy businesses.

CVS Health’s Caremark, Cigna’s Express Scripts and UnitedHealth Group’s Optum control the majority of pharmacy benefit management (PBMs) in the US, while their parent companies also operate health insurance businesses.

Shares of all three companies fell between 4.8% and 5.5% after the Wall Street Journal first published news of the bill.

The bill, sponsored by Senators Elizabeth Warren, a Democrat, and Josh Hawley, a Republican, would force companies owned by health insurers or pharmacy benefit managers to sell their businesses that operate pharmacies within three years.

Representatives Diana Harshbarger, a Republican, and Jake Auchincloss, a Democrat, are also supporting the bill, which will be introduced in Congress.

PBMs negotiate prescription drug prices between insurers, pharmacies, and drug manufacturers, and reimburse pharmacies directly for covered prescription drugs under their agreed terms.

they have come under scrutiny first For their effect on prescription drug prices.

“PBMs have manipulated the market to enrich themselves – increasing drug costs, defrauding employers, and driving small pharmacies out of business. My new bipartisan bill will address conflicts of interest by reining in these middlemen,” said Senator Warren.

Shares of other insurers such as Allevance, Humana and Centene fell between 1% and 3%.

Leerink Partners analyst Michael Cherney said, “The latest introduction of potential legislation to restrict PBM operations and broader health care vertical integration is unlikely to gain traction, although it is difficult to rule it out outright.”

shares of insurers come under pressure after Brian ThompsonThe CEO of UnitedHealth’s health insurance unit was fatally shot outside a Manhattan hotel last week.