Pharmacy Benefit Managers (PBMs), the middlemen that negotiate rebates and manage drug benefits for health plans, businesses and government programs, bill themselves as saving money for government and the private sector, but their record is a checkered one. NLARx is working with state legislators to enact laws establishing transparency, anti-kickback, conflict of interest and other ethical standards for PBMs, which have been targeted in numerous fraud cases and other litigation. The First Circuit Court of Appeals upheld the Maine law, the first such state law to be enacted, in a broad decision, finding it does not impermissibly step on the jurisdiction of the federal government, whether under the ERISA law or constitutional provisions regarding interstate commerce, protection of property (trade secrets) or free speech, and the Supreme Court has refused to review this holding.

Researching this Issue

Model state PBM laws and best practices, testimony supporting these initiatives, and background information and research materials including reports, legal briefs and decision, and news articles are posted here. Information on PBM fraud litigation is posted on the Medicare & Medicaid issue page. The Pharma Watch page is also a good resource for information on how the PBM industry markets itself. See also the Related Links below to connect to other organizations and materials with relevant information on this issue.