Specialty drugs account for less than 2 percent of prescriptions but more than half of total pharmacy spend. Employers that fail to actively manage this category risk runaway costs, employee dissatisfaction, and fiduciary exposure. The good news is employers can regain control with a straightforward framework grounded in fiduciary responsibility.
1. Start with a PBM that Puts the Employer First
Too many pharmacy benefit managers operate with divided loyalties. They promise savings while quietly maximizing their own profit streams. Employers should demand contractual proof that the PBM is aligned with their interests. That means transparency in pricing, contract terms that eliminate hidden revenue, and a fiduciary standard of care written into the agreement, not just implied. If a PBM will not sign on the dotted line, that is a red flag.
2. Carve Out When the PBM Owns a Pharmacy
When PBMs own or are affiliated with specialty pharmacies, the conflict of interest is obvious. They control the formulary, dictate utilization management, and then direct prescriptions to their own pharmacy. Employers should not accept this setup. The solution is carving out formulary design and utilization management to an independent party. Doing so separates clinical decision-making from dispensing profit, ensuring drug selection is based on patient outcomes and plan value, not the PBM’s bottom line.
3. Avoid PBMs That Use CoverMyMeds for PAs
CoverMyMeds, a platform widely used for prior authorizations, is owned by McKesson, one of the largest drug wholesalers and a company with its own interests in drug distribution. When PBMs rely on CoverMyMeds, employers risk having a key utilization management function tied to an entity that profits from higher drug sales. Employers should press their PBMs on what systems are being used for PAs and avoid arrangements that create this type of conflict.
4. Reject Rebate-Driven Formularies
Formularies designed around rebates look good on the surface but often drive up net cost. PBMs and their aggregator partners structure them to capture rebate revenue while keeping high-priced drugs on the plan. Employers should instead push for lowest-net-cost formularies, where clinical outcomes guide placement, not rebate checks. A simple question can uncover conflicts: was the formulary designed and managed in-house by the PBM, or is it controlled by a rebate aggregator? If it is the latter, the employer should assume the design serves the aggregator’s financial interests first.
5. Close the Knowledge Gap
Employers do not lose control of specialty drug spend because they are careless. They lose because the system is complex by design. PBMs, consultants, and aggregators rely on this knowledge gap to maintain leverage. Employers who invest in education, whether through fiduciary-aligned partners or internal training, level the playing field. Without closing this gap, employers will always be outmaneuvered by those paid to advise them.
Final Thought
Specialty drug management does not require complex algorithms or endless vendor meetings. It requires discipline, independence, and a fiduciary mindset. Employers who follow these five principles can break free from conflicted arrangements and reclaim control of their pharmacy spend.
