PBM Private Labeling Boosts Biosimilars, Raises Concerns

Nearly 2 years after entering the market, adalimumab biosimilars are finally seeing traction.

CVS Health’s Caremark, Cigna’s Express Scripts, and UnitedHealth Group’s OptumRx, which are pharmacy benefit managers (PBMs) that collectively control about 80% of all prescriptions in the United States, are now pivoting away from Humira and preferring biosimilars on their formularies.

But rather than preferring multiple biosimilars on their formularies, these companies have created their own subsidiaries to co-produce these medications. With this approach, known as white or private labeling, these companies can produce a medication and subsequently prefer that same drug on their formularies.

Experts are divided on whether these companies’ control of multiple stages of the drug supply chain will be beneficial or detrimental to the biosimilars market. On one hand, these agreements had resulted in adalimumab biosimilars market share climbing to nearly 25% with medications priced more than 80% lower than the reference product.

Conversely, this domination of the drug supply chain could be anticompetitive and may dissuade manufacturers in developing biosimilars for other drugs.

Switching to Biosimilars

Despite nine Humira biosimilars entering the market in 2023, Humira remained dominant. During this first year of competition, these biosimilars only made up less than 2% of adalimumab prescriptions in the United States.

In 2023, CVS launched Cordavis, a subsidiary that co-produces and commercializes biosimilar products. In the first quarter of 2024, it began co-producing Sandoz’s Hyrimoz (adalimumab-adaz), and CVS’s PBM, Caremark, removed the reference product Humira from major commercial template formularies in April 2024. As of January 2025, these formularies prefer Hyrimoz manufactured by Sandoz at a high list price as well as Hyrimoz manufactured by Cordavis and unbranded adalimumab-adaz by Sandoz at a low list price, according to the Drug Channels Institute. (Caremark’s “Choice formularies” still cover Humira and a co-branded version of Humira by Cordavis.)

Once CVS made this pivot, market shares started to change. As of November 2024, adalimumab biosimilars made up 23% of market share, with Hyrimoz leading the pack with 15% market share, according to a report by Samsung Bioepis. Hadlima (adalimumab-bwwd), developed by Samsung Bioepis & Organon, follows with 4% of the market as the preferred biosimilar on the US Department of Veterans Affairs national formulary.

The other two top PBMs soon followed suit, with Cigna announcing in April 2024 that its own pharmaceutical distributor, Quallent Pharmaceuticals, would partner with drugmakers to stock adalimumab biosimilars.

As of January 1, 2025, Cigna’s PBM Express Scripts excludes Humira on its 2025 national formulary and prefers Boehringer Ingelheim’s Cyltezo (adalimumab-adbm), Teva/Alvotech’s Simlandi (adalimumab-ryvk), and unbranded adalimumab-adaz. Cyltezo is offered at the high list price, and both unbranded adalimumab-ryvk and adalimumab-adbm by Quallent are 46% below Humira’s list price, according to the Drug Channels Institute. The plan also prefers Simlandi and unbranded adalimumab-adaz at their low list prices.

UnitedHealth Care’s PBM, OptumRx, has also launched its own private-label manufacturer, Nuvaila, to co-produce Amgen’s Amjevita (adalimumab-atto). Nuvaila is also the sole distributor of Amgen’s ustekinumab biosimilar, Wezlana (ustekinumab-auub), which launched in January 2025. Amjevita and Wezlana are available at both high and low list prices.

As of January 1, 2025, OptumRx excludes Humira and prefers Amjevita for patients new to therapy. Existing patients are yet not required to switch to the biosimilar. The PBM is holding off preferring only the biosimilar “until all drug strengths are interchangeable at the pharmacy without a new prescription,” the formulary update stated, which is expected later this year. Stelara and Wezlana are both preferred under the current formulary.

Anticompetitive or Cost-Saving?

This switch to biosimilars can reduce costs for patients, with many paying no out-of-pocket costs for their prescriptions, but vertical integration of the drug supply chain could lead to anticompetitive practices.

The current situation parallels the 1990s, when pharmaceutical companies purchased PBMs.In 1993, Merck acquired the PBM Medco, and in 1994, Eli Lilly announced its purchase of the prescription management business PCS Health Systems Inc.

These acquisitions raised eyebrows at the Federal Trade Commission (FTC), which argued that a manufacturers’ drugs receiving favorable treatment through an acquired PBM’s formularies was anticompetitive.

Medco and PCS Health Systems were required to maintain an “open formulary,” which included all drugs approved by an independent committee. Both Merck and Eli Lilly eventually divested these PBMs.

These 1990s cases are similar to current PBM practices, though today’s PBMs possess more market power.

“PBMs play a much bigger role today in shuttling patients to specific drugs than they did in the 90s,” said S. Sean Tu, JD, a law professor at West Virginia University, Morgantown, West Virginia, whose research focuses on patent law and drug pricing.

“Bigger amounts of money [and] more consolidation equals bigger problems for patients who can’t afford these medications,” he added.

In addition to the foray into co-production of medications, these healthcare companies already have their own specialty pharmacies, including CVS Specialty, Accredo (Cigna), and Optum Rx Specialty Pharmacy.

“Here you have vertical integration of now, the manufacturer [of a drug], the PBM, which creates the formulary and prefers it, and the specialty pharmacy, which fills it,” said Madelaine Feldman, MD, a private practice rheumatologist in New Orleans and the vice president of advocacy and government affairs for the Coalition of State Rheumatology Organizations.

The FTC has already filed a lawsuit against CVS Caremark, OptumRx, Express Scripts, and affiliated group purchasing organizations for “engaging in anticompetitive and unfair rebating practices that have artificially inflated the list price of insulin drugs,” according to the case summary.

Using the same reasoning from the FTC in the 1990s, these three healthcare companies preferring their own product could be considered anticompetitive. However, at the same time, prices for these biosimilars have fallen under these co-production deals.

“It’s a bit of a counterintuitive argument to say that this presents competitive concern even when the price goes down,” explained Michael A. Carrier, JD, of Rutgers Law School in Camden, New Jersey. He specializes in antitrust and intellectual property law in the pharmaceutical industry.

Future of Biosimilars 

Although these PBM-owned pharmaceutical distributors have increased the uptake of adalimumab biosimilars, it also raises questions about the future development of other biosimilars.

“It’s a short-term gain for potentially some long-term concerns about the biosimilar marketplace,” said Benjamin Rome, MD, MPH, a faculty member of the Division of Pharmacoepidemiology and Pharmacoeconomics at Brigham and Women’s Hospital in Boston.

If white labeling is the most effective way to achieve uptake from patients, and there are only three major companies to partner with, it could dissuade drug companies from investing in developing additional biosimilars, Feldman said.

“Why would you bother to make a biosimilar if you’re never going to get on the formulary unless you white label it with a company?” Feldman said. “If [the company] already white labels with ‘cool kids,’ they are not going to white label with you.”

Drug companies would likely still develop products for European and other markets, but whether they pursue regulatory approval in the United States “is the fundamental question,” Rome said. “They’re only going to do that if they think that there’s a viable chance that their products going to be marketed and sold and used by patients in United States. If they don’t think there’s a good chance that that’s going to happen, then it’s a waste of their time and financial resources to seek regulatory approval.”

Feldman, Carrier, and Rome had no disclosures. Tu is a consultant for payers who may be litigating against drug companies on lenalidomide- and abiraterone-containing products.