Drugstore Lobby 'Power Grab' Hits Legal Roadblock

WASHINGTON, Feb. 26, 2013 /PRNewswire-USNewswire/ -- Facing a lawsuit alleging violations of federal law, the Mississippi Board of Pharmacy (BoP) reversed course and rescinded a proposed regulation that would have imposed unprecedented - and costly - new fiduciary mandates on pharmacy benefit managers (PBMs), the companies that employers, unions, and state agencies hire to negotiate discounts from drugstores. Most states, including Mississippi, have traditionally relied upon the State Department of Insurance - not the Board of Pharmacy - to oversee PBMs.

The overreach by the Mississippi BoP and ensuing legal challenge by the Pharmaceutical Care Management Association (PCMA) should give policymakers in other states pause when considering granting sweeping new authority to state boards of pharmacy, the association said today.

"Mississippi is the only state to empower pharmacists on a Board of Pharmacy to regulate those with whom they negotiate and do business," said PCMA President and CEO Mark Merritt. "When Boards of Pharmacy push anti-competitive regulations that violate federal laws, we intend to vigorously challenge them."

Allowing pharmacy boards to regulate PBMs creates a conflict of interest since the Board members are pharmacists - a group which contracts with PBMs and could financially benefit from the policies they set. The Federal Trade Commission warned the Mississippi legislature when it transferred regulatory authority from the Insurance Commission to the Board of Pharmacy that allowing pharmacists to regulate PBMs could "increase pharmaceutical prices and reduce competition" and potentially "facilitate collusion" among pharmacies.

PCMA represents the nation's pharmacy benefit managers (PBMs), which improve affordability and quality of care through the use of electronic prescribing (e-prescribing), generic alternatives, mail-service pharmacies, and other innovative tools for 215 million Americans.

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SOURCE Pharmaceutical Care Management Association