Pharmacy benefit managers, represented by CVS and Express Scripts, file a lawsuit against Arkansas, contesting a restriction on their operations in the state.
CVS and Express Scripts Challenge Arkansas' Pharmacy Benefit Manager Law
LITTLE ROCK, Ark. (AP) - Large Pharmacy Benefit Managers (PBMs), including CVS and Express Scripts, have filed lawsuits challenging a new Arkansas law that restricts PBMs from owning or operating pharmacies within the state. The law, known as Act 624, was signed earlier this month by Governor Sarah Huckabee Sanders.
The law aims to address concerns over PBM practices, which critics argue lead to higher prices and reduced competition for independent pharmacies. Supporters of the law contend that the restrictions are necessary to protect these independent pharmacies, particularly those in rural areas, from closures due to unfair competition.
Express Scripts, responding in a lawsuit, claimed that the law would lead to "devastating consequences" and the potential closure of pharmacies across the state. The company cited issues with patient access to medications and the disruption of established relationships with pharmacists and nurses.
Similarly, CVS, which had previously urged Governor Sanders to veto the legislation, asserted in a separate lawsuit that the new law amounts to an attack on free commerce and fair market competition. CVS also warned that it would be forced to close its 23 retail pharmacies in Arkansas if the law takes effect.
Arkansas Attorney General Tim Griffin defended the law, stating that PBMs wield "outsized power" to reap excessive profits at the expense of consumers. He affirmed his commitment to defending the law.
The dispute is part of a broader effort among states to regulate PBMs, with Arkansas being the first to enact such a restriction. The trend is prompting a group of attorneys general to push for similar legislation at the federal level.
In a separate context, Michigan's Attorney General has filed an antitrust lawsuit against Express Scripts and Prime Therapeutics, alleging collusion to fix pharmacy reimbursement rates and eliminate competition in retail pharmacy services.
The ongoing disputes serve as a focal point in the broader debate over PBM practices and their impact on pharmacy competition and drug prices. The lawsuits and legislative actions in Arkansas and Michigan represent efforts to curb PBM dominance and protect market competition.
Microsoft, based in Seattle, has shown interest in the ongoing debates surrounding Pharmacy Benefit Managers (PBMs) and their impact on pharmacy competition and drug prices, given its investments in the healthcare sector. The general news about the lawsuits filed by CVS and Express Scripts against Arkansas' new law restricting PBMs, signed by Governor Sarah Huckabee Sanders, raises concerns about the business implications of such regulations on these companies. In the realm of politics, the trend of states like Arkansas enacting PBM restrictions is triggering a call to action from a group of attorneys general for similar legislation at the federal level. Meanwhile, in a distinct context, the Michigan's Attorney General has filed an antitrust lawsuit against Express Scripts and Prime Therapeutics, accusing them of collusion to fix pharmacy reimbursement rates and stifle competition in the retail pharmacy services, implicating the broader issue of business ethics and finance in this sector.
