Politics

Attorney General Rutledge Continues Fight to Curb Pharmacy Benefit Managers


LITTLE ROCK – Arkansas Attorney General Leslie Rutledge joined a bipartisan coalition of 30 attorneys general in filing an amicus brief supporting North Dakota’s regulation of pharmacy benefit managers (PBM) and arguing that North Dakota is entitled to curb abusive PBM practices.

“Our U.S. Supreme Court win paved the way for other states to take a stand against predatory pharmacy benefit managers,” said Attorney General Rutledge. “I will continue to fight for local pharmacists and lower drug prices for all Arkansans and Americans.”

The U.S. Supreme Court directed the Eighth Circuit to reconsider the North Dakota case, Pharmaceutical Care Management Association (PCMA) v. Wilke, following Attorney General Rutledge’s unanimous U.S. Supreme Court win in Rutledge v. PCMA.

In Rutledge, the Supreme Court rejected the Eighth Circuit’s ERISA analysis and held that Arkansas had authority to impose various cost regulations on PBMs. For example, the Court held that, contrary to PCMA’s claims, Arkansas could require PBMs to reimburse pharmacies for at least the amount pharmacies pay to acquire a drug.

PBMs are middleman companies that pay pharmacists for prescription drugs dispensed to insurance beneficiaries. PBMs regularly paid pharmacies less than it costs pharmacies to acquire generic drugs while pocketing a hefty profit. That abusive market practice had caused more than 16 percent of rural pharmacies nationwide to close in recent years. These same PBMs have imposed self-serving protections that reduce reimbursement rates to pharmacies, maximize rebates to PBMs, and impose various confidentiality requirements. For example, PBMs have tried to prevent pharmacies from even telling consumers the actual cost of drugs. The PBM industry reaps hundreds of billions of dollars annually.  

These business practices have harmed consumers, pharmacies, and states. Rural and independent pharmacies have especially struggled to survive when PBMs impose financially unsustainable conditions. 

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