Pharmacy Orgs Urge Court to Uphold Tennessee’s Right to Regulate PBMs

ALEXANDRIA, Va. (Aug. 6, 2025) – The National Community Pharmacists Association (NCPA), the American Pharmacists Association (APhA), and the Tennessee Pharmacists Association (TPA) yesterday filed a joint amicus brief in federal court in support of Tennessee’s law to regulate pharmacy benefit managers.

Tennessee passed a reform law in 2021, which includes provisions banning PBMs from engaging in patient steering, and from excluding pharmacies from preferred networks. McKee Foods, the maker of baked goods such as Little Debbie snacks, challenged the law, arguing that states are preempted by the federal Employee Retirement Income Security Act of 1974 (ERISA).

A district court granted McKee’s petition for an injunction against the law. The case is now before the federal Sixth District Court of Appeals, where NCPA, APhA, and TPA are supporting the state.

“Because PBMs owe fiduciary duties only to their shareholders, not the plans that they purport to serve, PBMs have incentives to engage in business practices that can harm plans, patients, and pharmacies. In the absence of regulation, PBMs have done just that,” they argue in the brief.

The brief goes on to describe the abusive practices for which PBMs are very well known, and which states like Tennessee have an obligation to curtail.

“PBMs routinely steer patients to their own affiliated pharmacies, and they routinely reimburse their own affiliated pharmacies more than they reimburse their competitors, which are often small, family-run, independent pharmacies,” said NCPA General Counsel Matthew Seiler. “Nearly every state in the country has enacted, or is trying to enact, PBM reform to curb these abuses. Patients in Tennessee should have access to the health care providers they trust.”

“It’s simple: pharmacies should not lose money when they dispense life-saving prescriptions. Until PBMs change their reimbursement practices to provide fair compensation to pharmacies for the medications as well as the professional services provided by pharmacists, APhA will continue to fight for reform of their practices. The U.S. Supreme Court has already unanimously ruled the states have a right to regulate the PBMs, including allowing pharmacies to participate in networks with favorable reimbursement terms,” said APhA Executive Vice President and CEO Michael D. Hogue, PharmD, FAPhA, FNAP, FFIP. 

“Tennessee has led the nation in advancing meaningful PBM reform—and recent state audits confirm why those laws are necessary. The McKee Foods case threatens the state’s authority to protect patients, providers, and employers from abusive PBM practices. TPA fully supports Tennessee’s effort through this amicus brief and defends its right to enforce laws that ensure transparency, accountability, and fairness in the prescription drug market,” said TPA Chief Executive Officer Anthony Pudlo, PharmD, MBA, MSHIA.

For more information about NCPA, please visit www.ncpa.org. For more information about APhA, please visit www.pharmacist.com. For more information about TPA, please visit www.tnpharm.org.