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Attorney General of Virginia

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Commonwealth of Virginia
Office of the Attorney General

Mark Herring
Attorney General

202 North Ninth Street
Richmond, Virginia 23219

 

For media inquiries only, contact:  
Charlotte Gomer, Press Secretary
Phone: (804)786-1022 
Mobile: (804) 512-2552
Email: This email address is being protected from spambots. You need JavaScript enabled to view it.

ATTORNEY GENERAL HERRING FIGHTS TO PROTECT STATES’ RIGHTS TO REGULATE PRESCRIPTION DRUG COSTS

RICHMOND(March 2, 2020) – Attorney General Mark R. Herring today joined a bipartisan coalition of 46 attorneys general in filing an amicus brief in the U.S. Supreme Court supporting states’ rights to regulate and address the rising cost of prescription drugs. In Rutledge v. Pharmaceutical Care Management Association, Attorney General Herring and his colleagues argue that in order to protect the well-being of consumers, states must regulate pharmacy benefit managers, also known as PBMs. PBMs act as middlemen between pharmacies, drug manufacturers, health insurance plans, and consumers. Their position gives them some power to manipulate the market as they develop and maintain prescription drug formularies, contract with pharmacies, negotiate discounts with drug manufacturers, and process and pay prescription drug claims. Today’s brief supports the state of Arkansas’ position that federal law does not prevent states from regulating PBMs. The attorneys general argue that regulation of the prescription drug market, including PBMs, is a critical tool for states to protect residents and address the access and affordability of prescription drugs.

 

“Millions of Virginians rely on prescription drugs and it is so important that they know they are paying a fair price for them,” said Attorney General Herring. “States’ ability to regulate prescription drug prices is critical to protecting consumers and make sure prescription drug marketplaces are fair and transparent.”

 

In 2015, the state of Arkansas implemented a law that regulated the reimbursement rates PBMs pay to pharmacies. Under the law, PBMs must raise their reimbursement rate for a drug if that rate falls below the pharmacy’s wholesale costs. The law also created an appeals process for pharmacies to challenge these reimbursement rates. The law was challenged by the Pharmaceutical Care Management Association, a PBM trade association, which argued that the Employment Retirement Income Security Act prevents the state of Arkansas from implementing the law. Arkansas has asked the Supreme Court to reverse a lower court judgment that held the law invalid.

 

In today’s filing, Attorney General Herring and his colleagues argue that state laws regulating pharmacy benefit managers are not restricted by federal law. Regulation is critical to the states’ ability to improve the transparency of prescription drug marketplaces and to protect consumers’ access to affordable prescription drugs, especially those in underserved, rural and isolated communities. To date, nearly every state has enacted laws that regulate PBMs in some way, including 44 new or amended laws in the last five years. In addition, the attorneys general assert that the regulation of pharmacy benefit managers promotes healthcare access and affordability for residents – taking away a state’s ability to regulate would create confusion and uncertainty in the market and harm patients.

 

Joining Attorney General Herring in filing today’s brief are the attorneys general of Alabama, Alaska, Colorado, Connecticut, Delaware, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Texas, Utah, Vermont, Washington, West Virginia, and Wisconsin, and the District of Columbia.

 

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