PINK - What's Next For Pharmacy Benefit Managers?

February, 14 2025 03:20 AM Simplify Health Care ETF

2025-02-14 03:20:00 ET

Summary

In the U.S., Pharmacy Benefit Managers serve as middlemen between insurers, drug manufacturers, and pharmacies, primarily by negotiating rebates on medications and promoting the use of generic drugs.
On the revenue side, PBMs get paid by insurance companies to secure rebates from drugmakers in exchange for favorable placement in the insurers’ health plans.
In our view, the traditional PBM model will continue to be under threat — including from President Trump — and increasingly vulnerable to disruption.

By Trevor Perry

These giant middlemen claim they help keep drug costs in check, but scrutiny-and competition-are brewing. ...