Series: The Truth About the Top Three PBMs

(Express Scripts, owned by Cigna)

It’s been well reported that the top three PBMs control nearly 80% of all U.S. prescription drug claims. They were originally established to negotiate prescription drug savings for patients, employers and taxpayers – and yet, Americans continue to face higher out-of-pocket costs for the medicines they need.

So, who are these PBMs and how can we separate fact from fiction?

Let’s take a closer look at the Big Three corporate middlemen in the drug supply chain, and how their business practices shape what patients pay at the pharmacy. This overview breaks down who owns the PBMs, how they operate and how their business decisions influence drug pricing throughout the drug supply chain. Most importantly, these dynamics highlight the need for PBM reform and more transparency around vertical integration.

First up: Express Scripts, owned by Cigna.

Cigna’s Acquisition and Market Power

Cigna’s $67 billion takeover of Express Scripts expanded its reach into a PBM that now controls roughly 30% of U.S. prescription claims, giving it enormous influence over what patients pay for drugs and how they access them.

This consolidation created one of the most powerful vertically integrated healthcare companies in the country. In 2023, Express Scripts alone held 15.5% of the rebate‑negotiation business. Cigna’s Evernorth – which includes the insurer, Express Scripts (PBM) and specialty pharmacy Accredo – reinforces this dominance through tightly linked business lines. That vertical integration puts a single company in control of drug pricing, coverage decisions, pharmacy dispensing and patient care management for millions of Americans.

Vertical Integration and Patient Impact

This structure gives Express Scripts the power to steer patients toward its own pharmacies, favor its preferred products on formularies, and retain significant rebate revenue. Its specialty pharmacy arm alone (Accredo / Evernorth) is a huge business – accounting for 40% of Evernorth’s revenue.

An FTC investigation found that Express Scripts and its peers marked up certain specialty drugs by hundreds to thousands of percent, generating $7.3 billion in excess revenue for themselves between 2017 and 2022, while driving up out-of-pocket costs for patients. Far from lowering costs, this level of integration and markup gives Cigna-Express Scripts outsized leverage that can squeeze payers and patients, making it harder for many to afford the medications their doctors prescribe. But Express Scripts’ influence does not stop with patients.

Consequences for Pharmacies and Employers

Beyond its market dominance, Express Scripts’ practices have had real consequences for community pharmacies. According to a recent antitrust lawsuit, Express Scripts has allegedly held 89% of the PBM market in Michigan, contributing to “pharmacy deserts” in parts of the state and squeezing independent pharmacies out of business. A 2024 congressional oversight report adds that, in some cases, reimbursement rates for branded specialty drugs are 22-26% below average wholesale price, forcing local pharmacies to absorb losses of up to 11.5% just to dispense life-saving medications.

Meanwhile, on the rebate side, while Express Scripts has publicly reported that it shares more than 95% of its negotiated rebates with clients, only about 60% of employers actually report getting full value back. That discrepancy raises questions about how rebate dollars flow and whether much of the so-called savings is being captured by Cigna / Express Scripts rather than passed transparently to payers – or, ultimately, to patients.

Reform is Needed

Cigna’s ownership of Express Scripts has created one of the most powerful forces in the prescription drug supply chain, with sweeping control over pricing, coverage, dispensing and patient access. The company’s size and vertical integration give it the ability to shape drug costs in ways that benefit its own businesses, often at the expense of patients, employers and independent pharmacies.

As policymakers, employers and consumers continue to scrutinize PBM practices, understanding how these powerful entities operate is essential to evaluating where reforms are needed and how the system can better serve the people who rely on it for their medications. Learn more about policy solutions here.