FTC orders PBM point‑of‑sale rebates

The Federal Trade Commission’s new rebate order does not hit the whole pharmacy benefit manager industry at once; it binds Express Scripts and affiliated entities, and it requires a new plan option that passes drug rebates to patients at the pharmacy counter. (ftc.gov) The order grew out of the Federal Trade Commission’s September 2024 case against Express Scripts, Caremark Rx, OptumRx, and affiliated group purchasing organizations over insulin pricing. The agency said the companies favored high-list-price drugs with bigger rebates and left patients with deductibles or coinsurance paying based on inflated sticker prices. (ftc.gov) On February 4, 2026, the Federal Trade Commission announced a settlement with Express Scripts, and on February 12 it published the proposed consent order for public comment. The agency said the changes could cut patients’ out-of-pocket costs for drugs like insulin by up to $7 billion over 10 years. (ftc.gov) (federalregister.gov) A pharmacy benefit manager is the middleman that builds drug lists for insurers and employers, negotiates discounts with drugmakers, and pays pharmacies. The Federal Trade Commission said six large managers handled nearly 95% of U.S. prescriptions, giving them broad control over which drugs patients can get and what they pay. (ftc.gov) The core change is about timing. Instead of keeping rebates in the back end of the system to lower plan costs later, Express Scripts’ standard offering must let members get the benefit of rebates or discounts at the point of sale, with no added fee beyond the actual cost of pre-funding the rebate. (federalregister.gov) The order goes beyond insulin. Legal analyses of the settlement say it applies to all drug products and biologics managed by Express Scripts, and it requires a “standard offering” for plan sponsors with new formulary, pricing, and disclosure terms. (goodwinlaw.com) (hoganlovells.com) That distinction matters because employers and insurers are the plan sponsors that choose how pharmacy benefits are structured. Hogan Lovells said the order does not force every client to take the standard offering, so the practical effect depends on how many sponsors adopt it instead of older rebate-based arrangements. (hoganlovells.com) The Federal Trade Commission paired the rebate rule with other changes to the Express Scripts model. The agency said the company must increase transparency and move its retail community pharmacy payments to a model based on a drug’s actual acquisition cost plus a dispensing fee and pay for non-dispensing services. (ftc.gov) Express Scripts was one of the three pharmacy benefit managers the Federal Trade Commission said together administer about 80% of U.S. prescriptions, according to a Goodwin summary of the case. The broader Federal Trade Commission inquiry has also said the six largest managers control nearly 95% of prescriptions and that the “Big 3” generated more than $7.3 billion in revenue from specialty generic drug markups from 2017 through 2022. (goodwinlaw.com) (ftc.gov) The companies have disputed the Federal Trade Commission’s theory of the case. Goodwin said the pharmacy benefit managers argued in 2025 that drug manufacturers, not middlemen, set list prices and that rebate negotiations can lower overall costs for health plan members. (goodwinlaw.com) Congress has also moved on the same market. The Consolidated Appropriations Act, 2026, signed on February 3, 2026, requires pharmacy benefit managers serving group health plans to pass through 100% of rebates to plan clients and adds disclosure and audit rules, with major provisions taking effect in 2028 and 2029. (mondaq.com) So the immediate story is narrower than the headline suggests: the Federal Trade Commission’s order is an Express Scripts settlement, not an industrywide rule. But it gives federal regulators a live template for moving rebates from back-office accounting to the pharmacy counter, where patients see the price first. (ftc.gov) (hoganlovells.com)