Contract Pharmacy Domination, Big Insurer Political Missteps, Modular Health Benefits

Hey all,

Happy hump day! DrugChannels contract pharmacy data has reminded us of how big PBMs have insinuated themselves into every corner of the pharmaceutical supply chain except developing drugs. At each stage they’re going to take their pound of flesh unless they are restricted by the market or the law. I’m hoping we see action behind reform by both plan sponsors and legislators soon. Enjoy the rundown! 

Jacob Brody (Co-Founder & CEO, ZorroRX)

(Drug Channels Institute) 340B Contract Pharmacy Market in 2025

The 340B contract pharmacy market in 2025 has become highly concentrated, with five major chains and PBMs—CVS Health, Walgreens, Walmart, Cigna’s Express Scripts, and UnitedHealth Group’s Optum Rx—controlling over 76% of all contract pharmacy relationships. Originally designed to support low-income patients via discounted drug pricing for safety-net providers, the program has ballooned into a profit engine for corporate pharmacies and PBMs, now encompassing nearly 60% of all U.S. pharmacy locations and over 229,000 unique contracts. Because clearly, the original goal of 340B was to ensure America’s neediest PBMs never went without. Full Article

(Healthcare Un-Covered) Big Insurance’s Political Donations Missteps in 2024

Health insurance executives and employees overwhelmingly backed Kamala Harris and Democratic candidates in the 2024 election, with 83% of nearly $3 million in presidential campaign donations going to Harris. This support challenges the long-held belief that Republicans are more aligned with insurers’ interests, as the industry has flourished under Democratic leadership since the Affordable Care Act, despite recent bipartisan scrutiny over consolidation and Medicare Advantage practices. Hopefully, this epic misfire in political gambling will inspire the Republican-held Congress and White House to finally pass real reform—after all, it’s a lot easier to regulate an industry when it didn’t pay for your campaign signs. Full Article

(Fierce Healthcare) Pharmacy Benefit Models & GLP-1 Coverage

Employers are increasingly exploring "unbundling" traditional pharmacy benefit manager (PBM) contracts—separating services like specialty pharmacy, delivery, and drug price negotiations—as a strategy to control escalating drug costs, especially for GLP-1 medications. The PSG report highlights a cautious but growing interest in modular benefit design, with firms like Blue Shield of California pioneering the model, while many employers remain wary of disrupting patient experience. A notable concern is the off-label use of GLP-1s prescribed for type 2 diabetes but used for weight loss, with 32% of employers expressing high concern and some taking steps like requesting chart notes, leading to surprising numbers of withdrawn prescriptions. Full Article