American voters — and their elected leaders — are fed up with the cost of prescription drugs. And they’re looking for someone to blame.
That blame ought to fall squarely on pharmacy benefit managers (PBMs) and insurers, which are siphoning off a growing share of total drug spending. Inflation-adjusted net drug prices — the average sum retained by drug companies after accounting for the rebates and discounts they offer to PBMs, insurers, hospitals, and others in the drug supply chain — fell in 2025 for the eighth year in a row.
But most patients and employers scarcely believe that statistic. To them, it often feels like prices just keep rising.
That’s because PBMs and insurers keep taking advantage of an opaque, convoluted supply chain to shift costs onto patients and their employers. A recent House Oversight Committee investigation identified more than 1,000 instances in which PBMs pushed patients toward more expensive medicines — which come with larger secret rebates for the PBM — over cheaper alternatives.
Simply put, many patients really are paying more. But middlemen — not drug companies — are the ones pocketing that increase.
Pharmacy benefit managers and insurers have engaged in a savvy public relations campaign to obscure this reality, absolve themselves of blame, and inaccurately shift blame onto drugmakers’ patenting practices instead.
Just last week, the heads of the PBM and employer-sponsored health plan lobbies argued in these pages that pharmaceutical patents are “driving up costs” for Americans. They wrongly asserted that the Hatch-Waxman Act — the four-decade-old law that guarantees new brand-name drugs a limited period of regulatory exclusivity, but also streamlines the approval of generic drugs — is “broken.” They inaccurately allege that brand-name drugmakers are patenting multiple components of their medicines to create “patent thickets” that unfairly prevent cheaper competitors from reaching the market.
These claims ignore the facts: America boasts the highest generic drug utilization rate in the developed world. Nine out of every 10 prescriptions in the United States are filled with generics. Savings from generics and biosimilars totaled almost $500 billion in 2025 alone.
The mere fact that drug companies — like all other industries — often file numerous patents to protect their various discoveries from premature copycatting also doesn’t prove foul play. The U.S. Patent and Trademark Office and the Food and Drug Administration have found no clear relationship between the number of patents associated with a brand-name medicine and the length of time it takes for generic competitors to arrive.
Ignoring these key facts, the PBM and insurer lobbies are pushing Congress to pass the Eliminating Thickets to Increase Competition (ETHIC) Act. This bill would limit the number of patents that drug companies can assert during infringement lawsuits.
In effect, it would block companies from protecting research discoveries that the U.S. Patent and Trademark Office has confirmed are novel, useful, and non-obvious.
Drug research is enormously expensive. Developing a new medicine is a highly complex process where scientific and regulatory uncertainty mean that only 1 in 10 are ultimately approved by the FDA. The R&D process can take 10 to 15 years and cost billions of dollars. Patent protections give companies and investors an incentive to take those risks — by ensuring that rivals won’t be able to immediately copy the fruits of that research and sell it as their own.
PRICE CAPS SOUND GREAT — UNTIL YOU HAVE CANCER AND A TWO-YEAR WAITLIST
Making valid patents harder to enforce weakens R&D incentives, including the incentive to continue to research medicines after FDA approval, which often leads to new indications in completely different diseases or stages of disease, as well as easier-to-administer forms and longer-acting versions of medicines.
Patients and policymakers have every right to be angry about the often unaffordable cost of medicines. But they shouldn’t fall for PBMs’ and insurers‘ blame game. Weakening the patent system would do little to make medicines cheaper — but it would deter lifesaving research, while letting middlemen off the hook for driving up patients’ costs.
Anne Pritchett, Ph.D., is the founder of Pritchett Policy Associates.