FTC secures settlement with Caremark, locks in up to $8.5 billion in consumer savings

The Federal Trade Commission (FTC) has reached a major settlement with Caremark Rx LLC and its affiliate Zinc Health Services LLC, resolving the agency's antitrust case against the pharmacy benefit manager over insulin pricing practices. The agreement, announced July 14, is the second such settlement the Commission has secured with a major PBM this year.

Under the deal, Caremark, a subsidiary of CVS Health Corporation, will change several business practices meant to lower patients' out-of-pocket drug costs, increase transparency and improve treatment of community pharmacies. The FTC estimates the settlement will lock in as much as $8.5 billion in consumer savings over the next decade, with an additional $4.5 billion in potential savings from point-of-sale rebates over the same period.

“The FTC under President Trump won’t stand for anticompetitive behavior that drives up prices for American consumers,” FTC Chairman Andrew N. Ferguson said in the news release. “The settlement with Caremark brings billions in real savings to consumers feeling the pinch from excessive prescription drug prices. And the settlement bars Caremark from interfering with hub pharmacies, which can help identify the lowest out-of-pocket option for patients and improve patient access to prescriptions.”

The settlement mirrors terms the FTC reached with Express Scripts Inc. in February. Both agreements delink PBM fees from drug list prices, require greater transparency and give retail community pharmacies the option to move to a cost-plus reimbursement model.

The case originated from a 2024 lawsuit accusing Caremark, along with Express Scripts and Optum, of artificially inflating insulin list prices through anticompetitive rebating practices that favored high rebates over lower net prices. According to the FTC, this system let the PBMs retain inflated rebates and manufacturer fees tied to list prices, while shifting costs to patients whose copays and coinsurance are calculated from those same inflated prices.

With the Caremark settlement finalized, the Commission's case against that company is resolved. Optum's case has been pulled from adjudication while the FTC considers a proposed consent agreement.

Beyond pricing changes, the order addresses concerns raised in a January 2026 House Judiciary Committee staff report examining how CVS allegedly protects itself from competition. The settlement specifically prohibits Caremark from unfairly interfering with pharmacies that choose to work with hub service providers, platforms that help coordinate benefits, prior authorization and financial assistance for patients. A monitor will oversee complaints related to this provision.

Other required changes include ending discrimination against lower-cost drug versions on standard formularies, passing rebates through to members at the point of sale and offering plan sponsors the ability to move away from rebate guarantees and spread pricing. Caremark must also delink, for its standard offering, fees paid by drug manufacturers to the PBM and group purchasing organization from list prices while maintaining its group purchasing organization activities in the United States. The company is additionally required to maintain or create drug affordability programs capping members' out-of-pocket insulin costs and extend those benefits to all members when a plan sponsor's formulary includes a covered insulin product, unless the sponsor opts out in writing.

The Commission voted 1-0-1 to accept the consent agreement for public comment, with Commissioner Meador recused. The public has 30 days to submit comments before the order can be finalized, after which it will carry the force of law regarding future Caremark actions.