U.S. Supreme Court Affirms Arkansas PBM Regulation Law

Published On: December 10, 2020|Categories: Blog, Legislative Advocacy, State Advocacy|

Major Victory for States’ Rights to Regulate PBMsToday the U.S. Supreme Court, in a unanimous 8–0 ruling (Rutledge v. Pharmaceutical Care Management Association) gave a clear victory to community pharmacies and their patients in this landmark case, resolving federal versus state regulation of PBMs and drug costs.In the ruling, the Court overturned the U.S. Court of Appeals for the 8th Circuit decision that found a 2015 Arkansas state PBM regulation statute to be in violation of the federal Employee Retirement Income Security Act (ERISA). The Arkansas state law ensured that PBMs couldn’t pay less than the wholesale cost of a drug to community pharmacies. The Supreme Court decision clarifies that states have expansive authority to oversee PBM activities through state regulation.IPC worked with the National Conference of State Legislators (NCOIL), an organization made up of insurance legislators from across the country, in providing an Amicus Brief to the Supreme Court. IPC congratulates the Arkansas State Attorney General, the Arkansas Pharmacists Association and the almost dozen other stakeholders for providing an unprecedented level of collaborative support for this case.

The IPC Government Relations Department will continue to assess this ruling and in light of its findings, monitor the outcome of a North Dakota PBM ERISA case (PCMA v. Tufte) that the U.S. Court of Appeals for the 8th Circuit invalidated earlier this year.

Questions? Contact the Government Relations Team at [email protected].