The PBM market is highly concentrated. The recent merger of Express-Scripts and Medco resulted in an industry that is dominated by two major companies: ESI-Medco and CVS Caremark
The massive control possessed by ESI-Medco and CVS Caremark enables them to act anti-competitively. Many of the smaller PBMs don't have the economies of scale that the "Big Two" have and can't reach as broad of a consumer base, putting them at a disadvantage.
Furthermore, ESI-Medco and CVS Caremark's market share gives them enormous bargaining power. Many companies simply aren't large enough to leverage change from the major companies.
This consolidated market has allowed ESI-Medco and CVS Caremark to grow their profits tremendously, without benefiting consumers. Profits in the PBM industry have skyrocketed in recent years, a phenomenon that is likely due to deception and unrealized savings for payors.
Skyrocketing Profits of the "Big Two" PBMs, in millions