Published Online: Saturday, July 1, 2006

In a key legal setback for pharmacy benefit managers (PBMs), the US Supreme Court shot down a challenge to Maine's controversial law requiring disclosures of prescription drug deals by PBMs. The Maine statute, which was challenged by PBM lobbyists for the Pharmaceutical Care Management Association (PCMA), requires PBMs to disclose rebates, conflicts of interest, and discounts from drug manufacturers that PBMs are retaining as profit rather than passing on to plan sponsors.

Although a spokesman for PCMA downplayed the ruling as "an expected procedural move," representatives of the nation's independent pharmacists predicted that the decision would open the door for similar PBM disclosure requirements nationwide.

"This is a green light for more state legislatures to enact similar laws reforming the PBM industry," said National Community Pharmacists Association (NCPA) Executive Vice President and Chief Executive Officer Bruce Roberts, RPh. "These sorts of ‘transparency' statutes protect both employers that provide drug benefits for employees and retirees, as well as consumers themselves, who pay the premiums."

State lawmakers may well need something to jumpstart their interest in PBM reform legislation. Although NCPA and other pharmacy groups are pushing for such requirements across the country, so far lawmakers appear reluctant to impose disclosure mandates for fear of driving up prescription drug costs. During 2006, the legislatures in at least 17 states have considered and rejected PBM disclosure laws similar to the Maine statute.

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