The $215 Billion Tollbooth: Anatomy of an Engineered Bottleneck

Engineering the Intelligent Enterprise · Jul 30, 2026 · 38m

We tolerate a financial structure in healthcare that would get a procurement manager fired in any other industry.

Out of the $650 billion spent annually on drugs in the U.S., roughly $215 billion is captured by intermediaries.

The system is not broken; it is functioning exactly as its contracts dictate.

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Pharmacy Benefit Managers (PBMs) are compensated based on a percentage of drug list prices.

They are financially incentivised to ignore cheap generics and push expensive, high-rebate drugs.

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In this episode, we break down the mechanics of the gross-to-net…