With UNH's Optum Rx Reforms, The Last Big PBM Domino Is Falling

Bloomberg health care reporter John Tozzi reported on LinkedIn (the link he shared is at https://www.bloomberg.com/news/articles/2026-05-11/unitedhealth-s-optum-rx-says-profits-won-t-depend-on-drug-prices/, though much of Bloomberg's content remains behind a paywall) that UnitedHealth Group stated that it will move away from having the profits from its Pharmacy Benefits Manager (PBM) unit linked to the bogus list prices of medications, the latest shift to address longstanding criticisms of its business model. United Health's Optum Rx unit continues to try challenging the legality of the FTC's legal authority, which appears now to be little more than delay tactics, but this news suggests that it seems to have given up on those ill-fated attempts.

Optum CEO Patrick Conway reportedly said in an interview: 'We want our earnings based on service to the client. We do not want any of those earnings tied to the list price of drugs, period.'

Without having full access to the paid Bloomberg content, the official company press release is available and accessible to anyone, and that can be found at https://www.businesswire.com/news/home/20260511088754/en/Optum-Rx-Introduces-Industrys-First-Transparent-Pharmacy-Care-Model/ which tells you most of what you really need to know. Below is an excerpt: 

"Under the new approach, Optum Rx clients will be offered a pricing structure with monthly, clearly defined fees per member that are independent of manufacturers' list prices or prescription volume, eliminating spread pricing and similar practices. Every client will have transparency into Optum Rx fees—including those associated with its group purchasing organization (GPO)—with clear disclosure of payments received from pharmaceutical manufacturers. By the end of 2027, group purchasing will fully transition to flat service fees."

In other words, this marks a shift from the nation's largest commercial health insurance company's PBM business unit away from spread pricing, rebate opacity, and list-price-linked economics which was precisely the "Intended Relief" the FTC was seeking in its very litigation against Optum Rx.

Optum Rx is acknowledging what the "net" pricing drug distribution system makes increasingly unavoidable:

• Simpler, fee-based pricing models will win
• Rebate-heavy strategies will lose favor
• Gross-to-net pricing arbitrage will be harder to sustain
• Transparent cash flows between will force intermediaries including PBMs to redefine their value

Make no mistake, it's not because Dr. Conway or the PBM he runs has suddenly had an epiphany about the role his company plays in runaway U.S. prescription drug price inflation, driven by Optum Rx's relentless demand for ever-higher rebates. The reality was that in 2022, the U.S. Federal Trade Commission (FTC) undertook a multi-year 6(b) study of the PBM industry "business practices" [referred to as "FTC Matter No. P221200"] and in 2024, upon its conclusion, the FTC sued the major PBMs for taking kickbacks to exclude less costly NDCs of unbranded and biosimilar insulin varieties from their formularies. And, as I have blogged before, that study did not occur by accident, patients like myself pushed for it to happen (catch my previous coverage at https://blog.sstrumello.com/2025/01/why-i-pushed-for-ftc-litigation-against.html for more).

The major PBMs had engaged in conduct that violated Section 5 of the FTC Act, 15 U.S.C. § 45, hence the FTC sued the big PBMs (see the FTC complaint at https://www.ftc.gov/system/files/ftc_gov/pdf/d9437_caremark_rx_zinc_health_services_et_al_part_3_complaint_corrected_public.pdf for more details), and the FTC had plenty of evidence proving that was precisely what the big PBMs (including Optum Rx) were doing.

To be sure, rival Cigna-owned Evernorth line of business (which consists primarily of Express Scripts; the company decided to rename it "Evernorth" because the name Express Scripts had become so toxic) and rival CVS Health/Aetna Caremark were also sued for the exact same conduct, and on February 4, 2026, Express Scripts agreed to a comprehensive settlement agreement to move away from using artificially-inflated drug list prices to its own negotiated "net" prices instead. The news of that settlement agreement can be read at https://www.ftc.gov/news-events/news/press-releases/2026/02/ftc-secures-landmark-settlement-express-scripts-lower-drug-costs-american-patients/ and is definitely worth reading if you have the time to do so; it's written in plain English so there should not be much there which an average reader would be unable to understand.

Finally, on March 24, 2026, CVS Health/Aetna/Caremark also agreed in principle to settle the litigation with the FTC (see https://www.fiercehealthcare.com/payers/cvs-caremark-ftc-reach-settlement-insulin-pricing-case/ for the news), although complete details of the CVS Caremark settlement were still being finalized.

However, note how on February 4, 2026, Drug Channels' creator Adam J. Fein (he sold that to HMP Global a few years ago, but I believe he still runs a consulting firm known as Pembroke Consulting) observed following about the Express Scripts settlement agreement (see "The FTC Blows Up Express Scripts' PBM Model—and Launches the Net Pricing Drug Channel", published on February 4, 2026 

https://www.drugchannels.net/2026/02/the-ftc-blows-up-express-scripts-pbm.html): 

"The settlement addresses virtually every warped incentive that we have been covering on Drug Channels for the past 20 years. I summarize them below, but it's worth reading the full document to appreciate just how completely the FTC has dismantled the existing PBM business model.

Taken together, these actions signal major momentum toward the 'Net Pricing Drug Channel' (NPDC)—a market environment in which [the PBMs' realized] 'net' prices, not [the artificially-inflated] list prices, determine access, economics, and competitive strategy.

The FTC settlement will help reset the relationship between list and 'net' prices, lower patient costs, and trigger sweeping changes for [employer health care] plan sponsors, [retail] pharmacies, [bio-pharmaceutical] manufacturers, and Express Scripts' PBM competitors."

So that's where things stand as of May 2026. 

One observation I really had to laugh at was because the FTC study was initiated in 2022 under the Biden Administration's FTC Chair Lina Kahn and two of the three FTC Commissioners were named by Democratic Presidents, hence the litigation against the major PBMs was initiated while Ms. Kahn was still in office as FTC Chair. And yet, in the FTC's press release, was this little statement clearly sucking-up to the current administration: 

"The FTC's settlement with Express Scripts ["ESI"] is a clear testament to the Trump-Vance FTC's focus on lowering healthcare costs for American patients," said FTC Chairman Andrew N. Ferguson. "The FTC's settlement with ESI will end its business practices that have kept drug prices high, ultimately providing meaningful financial relief to American patients who depend on ESI to access life-sustaining prescription drugs as well as community pharmacies who will see new revenues each year and relief from being squeezed."

Trump-Vance had almost nothing to do with it, that was all Biden-Harris. Yet Lina Kahn stepped down as Chair of the FTC when President Biden left office. Still, it is very obvious the Trump Administration simply tried to take credit for the work his predecessor accomplished with the FTC under Biden's leadership, and this PBM litigation and the ensuing settlements with the big PBMs was the culmination of that. Trump and his administration really had nothing to do with it other than to execute the final settlement agreements, which were the result of litigation his predecessor had already initiated, and they did not really have a choice given the "Intended Relief" which the FTC had already documented in its 2024 litigation against the PBMs.

Still, with the United Health Group Optum Rx PBM moves now to alter how it does business, that means that all three of the largest PBMs have agreed to the FTC's "Intended Relief" and will stop some of their most egregious business practices of effectively stealing money intended for covered patient price relief and using that cash to sell more insurance policies. 

As the executive summary in one of the FTC interim reports on the PBM business practices stated: "As a result of drug manufacturer rebates, the net prices of drugs to payers are often substantially less than the point‑of‑sale prices that determine patient cost sharing and deductibles at the pharmacy counter."

However, with these actions on the big three PBMs and the actions the PBMs are now taking, it is looking as if these egregious (and, let me remind my readers, they are indeed unlawful) business practices will soon come to an end. It cannot come a moment too soon for patients who have been financially harmed by these practices.