Chicago – Attorney General Kwame Raoul, as part of a bipartisan coalition of 32 attorneys general, asked the U.S. Supreme Court to grant certiorari in a case addressing the states’ authority to regulate pharmacy benefit managers (PBMs). In an amicus brief, Raoul and the coalition ask the court to grant Oklahoma’s request that the court review a decision from the U.S. Court of Appeals for the 10th Circuit holding that federal laws preempt Oklahoma laws regulating PBMs.
Raoul and the bipartisan coalition seek to protect consumers by assuring that states can regulate PBMs. The attorneys general write in their amicus brief that the broad approach of the Pharmaceutical Care Management Association (PCMA) and the 10th Circuit to federal preemption would “severely and unduly impede states’ abilities to protect their residents and regulate businesses.”
“PBMs have put a focus on driving up their own profits at the expense of patients,” Raoul said. “State regulation of the prescription drug market, including pharmacy benefit managers, is a critical tool in protecting residents and addressing issues related to access and affordability of prescription drugs. I will continue to advocate for reforms that ensure prescription pricing is transparent and reduce the financial burden on patients.”
PBMs are intermediaries in the prescription pharmaceutical industry between prescription drug plans, pharmacies and drug manufacturers. PBMs profit from fees charged to market participants and by reimbursing pharmacies less than the PBM is paid by plans for dispensing medications.
PBMs have adopted self-serving protections that reduce competition, limit prescription medication access and impose various confidentiality requirements that limit transparency. For example, PBMs have tried to force consumers to use PBM-affiliated pharmacies at the expense of independent pharmacies by giving consumers preferential rates if they use a PBM-affiliated pharmacy, or by denying coverage at non-affiliated pharmacies altogether.
PBMs have been largely unregulated for decades. Earlier this year Attorney General Raoul, along with 38 attorneys general, urged Congress to take further actions to regulate PBMs at the federal level. In the absence of federal regulation, states have stepped up to protect consumers and pharmacies. The challenge to Oklahoma’s laws is the latest in a string of lawsuits by the PCMA, the PBM industry’s national lobbying association, seeking to block state regulations. The Oklahoma laws at issue aim to ensure adequate pharmacy networks and curtail self-dealing among PBMs.
Today’s brief is the most recent action in Raoul’s ongoing efforts to support states’ ability to fairly regulate PBMs. In 2020, Raoul joined a bipartisan coalition of 46 attorneys general in filing an amicus brief in support of an Arkansas law regulating pharmacy reimbursement rates. In 2021, Raoul joined a bipartisan coalition of 34 attorneys general in filing an amicus brief in support of North Dakota’s PBM regulations.
Joining Attorney General Raoul in today’s brief are the attorneys general of Arizona, California, Colorado, Connecticut, Delaware, the District of Columbia, Florida, Hawaii, Indiana, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Nebraska, Nevada, New Hampshire, New Jersey, New York, North Carolina, Ohio, Oregon, Pennsylvania, Rhode Island, South Dakota, Texas, Utah, Virginia and Washington.
