Arkansas PBM Lawsuit: CVS & Express Scripts Fight Back
- A new Arkansas law designed to curb the influence of pharmacy benefit managers (PBMs) is facing legal challenges.CVS caremark and Express Scripts have filed separate lawsuits against Act...
- Sarah Huckabee Sanders signed the legislation in April, aiming to address concerns that PBMs' increasing ownership of pharmacies leads to higher drug prices and stifles competition.
- CVS Health's Amy Thibault stated the law would force 23 community pharmacies to close, impacting specialized care for 10,000 patients and increasing healthcare costs.
Facing a legal challenge, Arkansas’s new law banning pharmacy benefit managers (PBMs) from owning pharmacies by 2026 ignites a fierce battle. CVS and Express Scripts,major players in the pharmaceutical industry,have filed lawsuits,claiming the legislation is unconstitutional and protects local pharmacies at the expense of fair market competition. The core of their argument focuses on the law’s potential to disrupt patient access, raise healthcare costs, and force pharmacy closures. The state counters that the law aims to hold pbms accountable. This legal showdown could reshape how states regulate PBMs and impact prescription drug prices. news Directory 3 offers in-depth coverage of this ongoing dispute and its implications. Discover what the court decides.
Arkansas Law Faces challenges Over Pharmacy Benefit Manager Ownership
A new Arkansas law designed to curb the influence of pharmacy benefit managers (PBMs) is facing legal challenges.CVS caremark and Express Scripts have filed separate lawsuits against Act 624, which prohibits PBMs from owning pharmacies in the state starting Jan. 1, 2026. The companies contend the law is unconstitutional and protects local pharmacies at the expense of out-of-state competition.
Arkansas Gov. Sarah Huckabee Sanders signed the legislation in April, aiming to address concerns that PBMs’ increasing ownership of pharmacies leads to higher drug prices and stifles competition. The law primarily targets the three largest PBMs—CVS Caremark, Express Scripts, and Optum Rx—which collectively manage 80% of U.S.prescriptions. These companies are now pushing back, arguing the law will force pharmacy closures, eliminate jobs, and ultimately increase healthcare costs for Arkansans.
CVS Health’s Amy Thibault stated the law would force 23 community pharmacies to close, impacting specialized care for 10,000 patients and increasing healthcare costs. Express scripts’ Susan Peppers echoed these concerns, warning of disruptions in access to medications and clinical support for hundreds of thousands of Arkansans.
Gov. Sanders’ office maintains the lawsuits are a reaction to the state’s efforts to hold PBMs accountable for anti-competitive practices. Communications Director Sam Dubke said the state is fighting for patient access and affordable prescriptions, and other states may follow Arkansas’ lead.
Both CVS and Express Scripts argue that Act 624 unfairly favors in-state pharmacies, which they claim charge higher prices. Express Scripts’ complaint highlights that the law’s purpose is to shield local pharmacies from out-of-state competition, even though existing Arkansas laws already prohibit certain anti-competitive tactics.
“With Act 624 signed into law, the Arkansas legislature and governor are forcing 23 community pharmacies to close by January 1, 2026…erode access to specialized pharmacy care…and increase the cost of Arkansas health benefits by millions of dollars each year,”
CVS also points out that the law exempts Walmart, a major Arkansas employer, which it says operates PBM-affiliated pharmacies. CVS claims the original bill,which would have included Walmart,was amended to exclude pharmacies serving only their own employee benefit plans,effectively allowing Walmart to continue operating while forcing CVS to leave the state.
while Walmart is not a PBM, CVS notes it provides PBM services through EmsanaRx, a firm launched by the Purchaser Business Group on Health, which includes walmart. CVS further alleges Walmart is expanding its pharmacy offerings in Arkansas and seeing increased prescription orders since the law was enacted.
Jesse C. Dresser, a partner at Frier Levitt’s Life Sciences Department, suggests the companies’ strongest legal argument rests on the Dormant Commerce Clause, which prevents states from enacting laws that discriminate against out-of-state businesses. Though, Dresser remains skeptical of the PBMs’ chances of success, citing states’ broad authority to regulate pharmacies.
What’s next
The outcome of these lawsuits could influence similar efforts in other states, such as Vermont and New York, that are considering legislation to regulate PBMs. The lawsuits against Arkansas’ pharmacy benefit managers could set a precedent for future state actions.