Conflict of Interest in Pharmacy Management

Legislation is being considered to prevent companies from owning both pharmacies and pharmacy benefit management (PBM) firms, highlighting potential conflicts of interest. PBMs negotiate drug prices on behalf of insurers but often have financial ties to the pharmacies they are negotiating with, creating a situation where incentivizing lower prices might be compromised. For instance, if a PBM and a pharmacy are under the same parent company, it could lead to inflated costs for health plans, ultimately raising premiums for consumers. This scenario is likened to a family negotiation where a spouse represents a buyer while also being related to the seller, which undermines the integrity of the negotiation process.