Experts agree: PBMs add value, lower costs

We all know that generic drugs save money, and both PBMs and their clients are aligned on the need to implement benefit designs that promote generics. The reason is simple: These programs save money and help promote better health outcomes.

It’s estimated that $16 billion per year in generic drug savings flow to plan sponsors and members can be directly attributed to PBM strategies.¹

One relatively new player, the Mark Cuban Cost Plus Drug Company (MCCPDC), has started selling generic prescription drugs through an online direct-to-consumer model. This model includes relatively few branded drugs, and usually operates outside health insurance.²

MCCPDC prices were recently analyzed in an article in JAMA Health Forum. The goal was to quantify whether, or how much, their prices would save money for consumers. The conclusions were striking. Of the 124 MCCPDC-supplied generic drugs studied, only 7.1% of prescriptions filled for people with private insurance saw any savings.³

Some of the largest employer costs of all are due to chronic disease. According to the CDC, 90% of the nation's annual health care spending is for people with chronic and mental health conditions. That amounts to more than $4 trillion! ⁴

Three in four American adults have at least one chronic condition, and over half have two or more chronic conditions, and chronic conditions are leading causes of death and disability in the U.S.⁵

But the good news is that many chronic diseases are treatable with prescription drugs.

For example, high blood pressure, coronary artery disease, diabetes, and depression can be successfully managed when patients routinely take prescribed medications.⁶

Unfortunately, many people do not take their medications as they should, citing cost as a primary reason.⁷ Optum Rx is directly addressing this problem by always driving to the lowest net cost for our clients and across our book of business.

Let’s explore this further by examining prices for some commonly used chronic medications. We recently compared drugs for chronic conditions ranked by their percentage of claims filed in 2025 across the U.S. High blood pressure, high cholesterol, diabetes and depression are well-known and highly prevalent chronic conditions.^8,9

Prices are shown for Optum Rx and for Mark Cuban Cost Plus Drug Company.

As we can see, Optum Rx prices are significantly lower for these critical medications. For this list of common medications, the 3^rd party vendor prices are 169% higher on average.

In general, Optum Rx pricing wins nearly 90% of the time against the cash market, delivering significant value for our clients and their members.

When it comes to treatments for conditions that affect millions of people and drive most employer costs, Optum Rx routinely delivers a far lower price. And lower prices matter.

But there is much more to the story than price. It’s important to understand that price-oriented vendors like MCCPDC are generally not attempting to replicate the range of services provided by a PBM like Optum Rx.¹⁰

This means they have no capacity to perform utilization management, or to turn the purchasing volume from a large membership into bargaining power and achieve leverage over product suppliers. One estimate is that having PBMs do this work contributes $145 billion per year to the economy, even after the cost of paying the PBMs.¹¹

Mark Cuban, in particular, is opposed to the formulary structure that drives much of the PBM benefit structure.¹² However, PBM formularies have very significant advantages for plan sponsors and members. 

First, they promote quality care through the decisions made by Pharmacy and Therapeutics (P&T) Committees. They consist primarily of clinicians who are charged with reviewing the scientific evidence for each drug – before any cost considerations.¹³

Second, PBM formularies promote competition among drug manufacturers. Makers of similar products compete by granting price concessions to get on PBM formularies.^{14, 15}

Overall, in addition to promoting clinical excellence, robust PBM buying power has helped them to negotiate lower drug prices and keep annual price growth low.^{16, 17}

A price-only vendor can supply none of this. Furthermore, people who use them may actually stand at some risk for higher out-of-pocket costs and increased clinical risk.

For example, prices paid to a stand-alone vendor don’t count toward annual insurance deductibles or out-of-pocket maximums. Patients who take expensive brand-name drugs through regular insurance must pay the full, undiscounted cost until they meet their deductible.¹⁸

Then there is the problem of fragmented care. When a patient uses different pharmacies for insurance-covered drugs and for Cuban supplied drugs, no one can maintain a complete and accurate medication history. This increases the risk of drug-drug interactions and hinders medication reconciliation.¹⁹

We deliver better value, access and transparency to help guide members to the best outcomes throughout every step in their journey, including:

• At the Doctor’s office: $214 average member savings per prescription with PreCheck MyScript.²⁰
• Online and on-the-go: $90+ average savings per script with MyScript Finder and proactive savings alerts lead to $24 average member savings.²¹
• On or Off Benefit: Lowest price available, on or off benefit, with Price Edge. $47 average member savings per non-covered prescription and over $169M in total savings in 2024.²²

Optum Rx is accountable for consistently delivering savings on prescription drugs. However, our responsibilities go well beyond merely dispensing affordable drugs.

Because everyone deserves a simple, affordable, personalized health experience. A holistic and connected approach to health. We’re here to help create those connections.

Ultimately, our goal is nothing less than to help create a simpler, more intelligent, adaptive health care system. One that has the power to change everyone’s life for the better.