Procurement Market Intelligence Report
Pharmacy Benefit Management Services
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Pharmacy Benefit Management Services Global Overview
Definition
Summary
A pharmacy benefit management (PBM) provider is a third-party company that manages the sale and distribution of government and employer-sponsored prescription drugs. In addition to processing prescription drug claims, PBM firms develop and maintain formulary. PBM providers leverage their size to contract with pharmacies and negotiate discounts and rebates with pharmaceutical manufacturers. This report is intended for buyers with fully funded insurance and is not tailored to self-insured employers. Common buyers of PBM services include health insurance carriers, pharmacies, and healthcare facilities.
This Report Includes:
- Prescription Drug Claims Processing
- Drug Formula Development & Maintenance
Not in this Report:
- Pharmacies
- Drugstores
Global Pharmacy Benefit Management Services Procurement Trends
Discover the top international trends affecting procurement in the global Pharmacy Benefit Management Services market.
Warning Trends
United States announces additional tariffs on China
- In February 2025, the United States announced 10.0% tariffs on imports from China. The tariffs took effect on February 4, 2025.
- The tariff plan applies to all merchandise imported for consumption and applies in addition to other duties and fees that are in place, with limited exceptions.
- In response, China announced a 15.0% tariff on products such as coal and natural gas, as well as a 10.0% tariff on crude oil, agricultural machinery, pickup trucks, and large cars. The tariff executive orders indicate retaliatory tariffs could lead to further escalation in rates.
- Providers in this market rely on inputs often sourced from China. As such, ProcurementIQ will continue to monitor developments in this space and update analysis accordingly.
United States postpones plans for sweeping tariffs on Canada and Mexico
- In February 2025, the United States announced 25.0% tariffs on imports from Canada and Mexico.
- Though initially set to take effect on February 4, 2025, the implementation of tariffs on Canada and Mexico has been postponed 30 days to allow for further negotiation.
- The tariff plan initially proposed by the US applies to all merchandise imported for consumption and applies in addition to other duties or fees that are in place, with limited exceptions.
- Providers in this market rely on input costs often sourced from an affected country. As such, ProcurementIQ will continue to monitor developments in this space and update analysis accordingly.
Global Pharmacy Benefit Management Services Market - Suppliers by Region
| Country/Region | Number of Suppliers |
|---|---|
| #1China | 225 |
| #2Europe | 210 |
| #3United States | 160 |
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Geography Drilldown - US & Europe
Average Cost of Pharmacy Benefit Management Services
United States
2025 Market Pricing$2.15 to $XX.XX
per transactionEurope
Average Price
Prices in the Pharmacy Benefit Management Services market range from $2.15 to $XX.XX, depending on Channel Type, Scope & Length of Contract, Drug Type and Value-Added Services. For example, lower prices are associated with Mail order, whereas higher prices are associated with Retail and Specialty.
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Between our Europe and Canada collections, we provide price data for 350 markets so you can instantly compare prices across borders. Or, use our custom research services for intel on prices in any region across the globe.
Pharmacy Benefit Management Services Category Price Trends
Pricing trends are indicated by the compound annual growth rate (CAGR) during a set period of time. For the Pharmacy Benefit Management Services market, prices in the US have grown 1.4% from 2022 to 2025. Subscribers can access price trend forecasts, price driver projections and forward-looking cost structure data. Learn more
United States (2022-2025)
1.4%
Compound Annual Growth RateUnited States (2025-2028)
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Price trend forecasts are available to subscribers, along with price driver projections and forward-looking cost structure data.
Cost Analysis - Total Cost of Ownership for Pharmacy Benefit Management Services
Total cost of ownership is High in the Pharmacy Benefit Management Services market. The average cost of ownership differs depending on the contract but generally includes costs negotiated before the contract begins, costs billed during the contract period and unforeseen costs. For example, unforeseen costs in the form of Scope Changes may raise the total cost of ownership unexpectedly.
Negotiated Before
Set Up Fees
Billed During
Additional Fees
Unforeseen
Scope Changes
Buyer Power in Procurement Negotiations
In 2025, buyer power amounts to -0.9 in the United States. Buyer power is most positively impacted by Market Share Concentration. It is most negatively impacted by Recent Price Volatility. Subscribers can access details on eight other factors that impact buyer power. Learn more
United States
Europe
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- Methodology and weightings for Buyer Power Score Components
Supply Chain Risk
The average level of supply chain risk is assessed as Medium, which has a negative impact on buyer power. The level of supply chain risk is affected by industry volatility, barriers to entry, competition, import penetration, regulation and industry financial risk. Buyers in this market can mitigate procurement and supply chain management risks by monitoring risk levels for individual first and second tier suppliers:
1st
Tier Suppliers
- Brand Name Pharmaceutical Manufacturers
- Generic Pharmaceutical Manufacturers
- Software Wholesalers
- Computer Manufacturers
2nd
Tier Suppliers
- Chemical & Allied Product Manufacturers
- Software Publishers
- Circuit Board & Electronic Component Manufacturers
Biggest Pharmacy Benefit Management Services Suppliers in the US by Revenue
The largest Pharmacy Benefit Management Services vendors by revenue in the US are Prime Therapeutics Llc, Rxadvance Corp and ProCare Pharmacy Benefit Manager Inc. Subscribers can sort and filter by market share concentration, profit level and other factors. Learn more
| Supplier | Operational Size | Headquarters | Number of Employees | Market Share (%) | Market Share Performance (3yr trend) | Total Revenue ($ million) | Profit Level (%) | Risk Level |
|---|---|---|---|---|---|---|---|---|
| Unitedhealth Group Incorporated | Global | MINNETONKA | >10,000 | 20-25 | ||||
| Cvs Health Corporation | National | WOONSOCKET, RI | >10,000 | 25+ | ||||
| Cigna Corp | Global | BLOOMFIELD | >10,000 | 25+ | ||||
| Anthem, Inc. | National | INDIANAPOLIS, IN | >10,000 | < 5 | ||||
| Humana Inc. | National | LOUISVILLE | >10,000 | < 5 | ||||
| Rite Aid Corp | National | PHILADELPHIA, PA | >10,000 | < 5 | ||||
| Rxadvance Corp | National | Southborough, MA | 51-100 | < 5 | ||||
| ProCare Pharmacy Benefit Manager Inc | National | Gainesville, GA | 251-500 | < 5 | ||||
| Prime Therapeutics Llc | National | Eagan, MN | 1,001-10,000 | < 5 | ||||
Looking for a list of suppliers by country?
Subscribers can access vendor information on Canadian and European suppliers, too. We also offer custom research services to help with vendor sourcing anywhere in the world.
Profit Analysis
The average profit margin across vendors in the Pharmacy Benefit Management Services market is 4.5% and steady. Profit levels shift depending on suppliers' spend on wages, purchases and overhead. The highest cost component for vendors is Wages. The cost trend for this component is falling, when considering movement between 2024 and 2025. To understand cost forecasts for 2026 and uncover the implications on profit, start your subscription. Learn more
Vendor & Supply Chain Analysis
Financial risk among vendors is moderate on average. The moderate risk level is primarily due to the high debt with which suppliers operate.
While pharmaceutical manufacturers present a high risk to the supply chain due to patent expirations on blockbuster drugs and the introduction of specialty drugs, which can cause jumps in drug prices, many other upstream suppliers, such as software publishers, pose a low level of risk. Consequently, supply chain risk is moderate on average.
There are about 160 companies operating in the PBM service market, which is highly concentrated and competitive. The top three suppliers, Cigna, CVS Health Corporation and UnitedHealth Group, control about 80.0% of total market revenue.
The United States is a net importer of computers, meaning it imports more computers than it exports. While lower manufacturing costs abroad drive down prices for imported computers, relying on imports can lead to potential shortages or price increases if there are supply chain disruptions due to geopolitical tensions, trade disputes, or global crises.
Supplier Information
Unitedhealth Group Incorporated
Unitedhealth Group Incorporated is a public company operating globally in the finance and insurance, professional, scientific and technical services and healthcare and social assistance sectors. The company's offerings include flexible spending account management services, healthcare consulting services, Subscribe to learn more
Cigna Corp
Cigna Corp is a public company operating globally in the finance and insurance sector. The company's offerings include flexible spending account management services, pharmacy benefit management services, group health insurance, disability insurance, vision insurance. Founded in 1792, the company is currently... Subscribe to learn more
Cvs Health Corporation
Cvs Health Corporation is a public company operating nationally in the manufacturing and finance and insurance sectors. The company's offerings include personal paper products, pharmacy benefit management services, group health insurance, disability insurance, vision insurance. Founded in 1963, the company... Subscribe to learn more
MedImpact Healthcare Systems Inc.
MedImpact Healthcare Systems Inc. is a private company operating internationally in the finance and insurance sector. The company's offerings include pharmacy benefit management services. Founded in 1989, the company is currently headquartered in San Diego, California, United States of America with an estimated... Subscribe to learn more
Prime Therapeutics Llc
Prime Therapeutics Llc is a private company operating nationally in the finance and insurance sector. The company's offerings include pharmacy benefit management services. Founded in 1998, the company is currently headquartered in Eagan, Minnesota, United States of America with an estimated 5500 employees.... Subscribe to learn more
ProCare Pharmacy Benefit Manager Inc
ProCare Pharmacy Benefit Manager Inc. is a private company operating nationally in the finance and insurance sector. The company's offerings include pharmacy benefit management services. Founded in 2004, the company is currently headquartered in Gainesville, Georgia, United States of America with an estimated... Subscribe to learn more
Rxadvance Corp
Rxadvance Corp is a private company operating nationally in the information and finance and insurance sectors. The company's offerings include pharmacy benefit management services. Founded in 2013, the company is currently headquartered in Southborough, Massachusetts, United States of America with an estimated... Subscribe to learn more
Rite Aid Corp
Rite Aid Corp is a public company operating nationally in the finance and insurance sector. The company's offerings include pharmacy benefit management services. Founded in 2002, the company is currently headquartered in CAMP HILL OWN, Pennsylvania, United States of America with an estimated 53000 employees.... Subscribe to learn more
Humana Inc.
Humana Inc. is engaged in providing medical and specialty insurance products and an integrated healthcare services delivery model. It organizes its business into two reportable segments: the Insurance segment, which retails medical and supplemental benefit plans to Medicare and state-based contract beneficiaries... Subscribe to learn more
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Procurement Management KPIs for the Pharmacy Benefit Management Services Market
Managing vendor performance throughout the contract period is easier when tracking specific key performance indicators (KPIs). For example, buyers should monitor Cost of Goods Sold and Defect Density. Buyers may experience better performance throughout their contracts if they establish service level agreements (SLAs) based on Prescription Processing Accuracy and other factors.
| KPI | Level of Importance (1-5) | Measurements | Key Considerations |
|---|---|---|---|
| Cost of Goods Sold | Total revenue Total material cost | The cost of goods sold represents the cost of providing products and services in the market, such as prescription drugs and processing claims. The cost of goods sold takes into account the costs of labor, material, service, and delivery. The cost of goods sold can be used to determine pricing strategies, including whether buyers are being charged appropriately for the services they are receiving. | |
| Defect Density | Number of units sold Number of defective units | The defect density represents the share of defective products a company produces or provides. In the PBM services market, defects can impact the drugs themselves or the containers in which the drugs are stored. The defect density can be used to determine whether manufacturing, assembly, supply chain, or quality assurance processes require improvement. | |
Questions to Ask During Procurement Negotiations
How can I gain leverage during negotiations?
Technology
PBM service firms may use proprietary technology that improves a buyer's internal systems but can result in higher switching costs.
What are the advantages of using your software compared with our own internal systems?
Supply Chain Risk
Have you experienced supply chain disruptions resulting from the coronavirus? How are you coping with these disruptions?
Has the pandemic restricted access to certain drugs? If so, what is being done to hedge against shortages?
Quality Control
How long, on average, does it take your company to process a claim?
Will you provide monthly reports detailing new claims and enrollees? What other key details are shown on your monthly reports?
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Pharmacy Benefit Management Services RFP Guidelines
What should my RFP include?
Organizational Overview
Buyers should provide a general overview of their organization, including facility type and size.
Buyers should provide the number of admissions and visits as well as the number of new patients per year.
Statement Of Need
Buyers should provide a list of their most commonly ordered drugs and the desired quantity of shipments.
Buyers should outline requirements for the types of distribution channels and whether or not they need walk-in services and prescription mail orders.
Project Budget
If one exists, buyers should specify their budget for the desired PBM services and related products and services.
Buyers should include information about any budgetary constraints.
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- Regulation and business requirements
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