On The Radar – 29th Edition
By
Employers are bracing for a projected 12% increase in pharmacy expenses, driven by GLP-1 utilization, specialty medications, and complex cell and gene therapies. Coverage of GLP-1s for obesity reportedly fell from 72% in 2025 to 60% in 2026 as employers tighten utilization management and explore direct purchasing, biosimilars, transparent PBMs, and other strategies.
➡ Why it matters: Employers are increasingly balancing access to high-cost therapies against the long-term financial sustainability of their pharmacy plans.
New legislation would cap what patients pay for covered prescriptions so that cost-sharing cannot exceed the nationwide average consumer price of the medication. The proposal is designed to protect patients from excessive markups and variations in pharmacy pricing.
➡ Why it matters: Policymakers are increasingly targeting what patients actually pay at the pharmacy counter, not just the underlying list price of medications.
While headline prescription drug prices have recently declined, employer healthcare costs continue moving in the opposite direction. Rising utilization, specialty medications, GLP-1s, and other high-cost therapies are increasingly responsible for overall plan growth.
➡ Why it matters: Lower unit prices do not necessarily translate into lower pharmacy spend when utilization and treatment mix continue to change.
Employer healthcare costs are projected to increase between 9.2% and 11.1% in 2027 before plan changes, marking another year of significant budget pressure. Catastrophic claims, specialty drugs, GLP-1s, cell and gene therapies, and high-cost conditions such as cancer are among the primary drivers.
➡Why it matters: Employers are turning to more aggressive clinical management, plan audits, navigation, and predictive analytics as traditional cost controls lose effectiveness.
Employers are increasingly reassessing relationships with the largest PBMs as fiduciary obligations, regulatory scrutiny, and demand for greater pricing visibility intensify. Transparent and pass-through alternatives are gaining attention as plan sponsors seek clearer accounting of fees, rebates, and total pharmacy costs.
➡Why it matters: PBM selection is becoming as much an accountability decision as a pricing decision.
National drug price indexes may be declining, but employers continue seeing pharmacy expenses climb as utilization shifts toward more expensive specialty and GLP-1 therapies. The disconnect is prompting employers to look more closely at utilization, supply-chain markups, and the true net cost of their pharmacy programs.
➡Why it matters: Employers need to look beyond headline drug prices to understand what’s actually driving their pharmacy spend.
As healthcare costs rise, benefits advisors are being called on to help employers evaluate strategies such as self-funding, reference-based pricing, transparent PBMs, and stronger vendor oversight. The role increasingly includes helping plan sponsors understand and fulfill their fiduciary responsibilities.
➡ Why it matters: Benefits strategy is moving beyond annual renewals toward continuous oversight of costs, contracts, and vendor performance.
NABIP is urging Congress to address prescription affordability through reforms focused on Medicare Part D stability, PBM accountability, formulary protections, and greater oversight of vertically integrated healthcare organizations.
➡ Why it matters: Policymakers face the challenge of lowering out-of-pocket drug costs without creating unintended consequences such as higher premiums or narrower access.
More employers are increasing oversight of medical and pharmacy benefits as double-digit premium increases become increasingly common. Strategies include self-insurance, more frequent PBM audits, data analytics, and closer scrutiny of GLP-1 and specialty drug spending.
➡ Why it matters: Rising costs are turning benefits management into a year-round financial and operational priority.
Recent pharmaceutical developments include new clinical trial results, an accelerated FDA approval, legal challenges involving 340B, and lawsuits targeting unapproved compounded obesity drugs. The updates come as the industry simultaneously navigates changing prescription pricing trends.
➡ Why it matters: Clinical innovation, regulation, litigation, and pricing pressures are increasingly intersecting across the pharmaceutical market.
Florida has sued Prime Therapeutics and Express Scripts, alleging the companies engaged in an illegal price-fixing arrangement that reduced pharmacy reimbursement rates. The state claims the agreement extracted billions from local pharmacies and is seeking penalties, damages, and injunctive relief.
➡ Why it matters: PBM scrutiny is expanding beyond transparency and rebates into antitrust enforcement and pharmacy reimbursement practices.
For self-funded employers, high-cost specialty drugs and gene therapies are changing the relationship between pharmacy benefits and stop-loss coverage. With individual claims capable of reaching hundreds of thousands or even millions of dollars, underwriters are paying closer attention to PBM contracts, utilization controls, and clinical management.
➡ Why it matters: Pharmacy strategy can now directly affect an employer’s catastrophic claim exposure and ability to secure sustainable stop-loss coverage.
Small and mid-sized employers are emerging as early adopters of transparent, pass-through PBM models. Their ability to move more quickly away from traditional rebate structures may offer a preview of broader changes across the commercial pharmacy market.
➡ Why it matters: The push for PBM transparency isn’t limited to large employers. Smaller organizations are increasingly demonstrating that alternative models can be viable at different plan sizes.
An opinion piece argues that focusing narrowly on a medication’s upfront price can create larger clinical and financial consequences. Re-authorizations and non-medical switching may disrupt stable treatment, increase administrative burdens, and lead to complications that require more expensive care later.
➡ Why it matters: Effective pharmacy management requires evaluating total cost and patient outcomes, not simply choosing the lowest-priced therapy.
Final Thoughts
Employer healthcare strategy is entering a new phase as pharmacy costs, catastrophic claims, fiduciary responsibilities, and regulatory scrutiny converge. Employers are responding with tighter utilization management, stronger vendor oversight, transparent PBM alternatives, and greater attention to how pharmacy decisions affect everything from patient outcomes to stop-loss coverage.
The recurring theme is that managing healthcare costs increasingly requires looking beyond price alone. Utilization, incentives, transparency, clinical value, and total financial exposure all matter.
We’ll be back in two weeks with more news you need to know. If you’d like a custom analysis or want to explore SHARx program options for your clients, contact us!
Stay Connected with SHARx
Subscribe to our newsletter for monthly updates from our CEO, curated industry news, insights from our in-house pharmacist, the latest blog posts, and more. Just fill out the form to stay informed.
Newsletter Sign-up
Be the first to learn what’s new with SHARx.