Federal and state governments' latest strategy in the fight to rein in the power of pharmacy benefit managers (PBMs) is focused on industry consolidation -- specifically, PBMs' ability to own pharmacies.
"In their quest to put profits over people, Big Pharma and the insurance companies continue to gobble up every independent healthcare provider and pharmacy they can find," Sen. Josh Hawley (R-Mo.) said in a press release Tuesday, the day he and Sen. Elizabeth Warren (D-Mass.) introduced the Break Up Big Medicine Act. "Working Americans deserve better. This bipartisan legislation is a massive step towards making healthcare affordable for every American."
The legislation would prohibit a parent company from owning a medical provider -- such as a pharmacy -- and a PBM or an insurer; it would give companies currently in such arrangements 1 year to divest themselves of one of the entities or face financial penalties.
"There's no question that massive healthcare companies have created layers of complexity to jack up the price of everything from prescription drugs to a visit to the doctor," Warren said in the press release. "The only way to make healthcare more affordable is to break up these healthcare conglomerates."
It's unclear whether their bill will gain any traction, but in the meantime, states are taking their own actions. Arkansas enacted a law last year that would bar any entity affiliated with a PBM from being granted a pharmacy permit. The Pharmaceutical Care Management Association (PCMA), a trade group for PBMs, sued in federal court to block the law, and the case is currently pending. In a press release, PCMA called the law "dangerous" and "misguided," saying it could cause about 40 pharmacies in the state to close.
"Further, the law would sharply reduce market competition in the prescription drug space by unlawfully discriminating against certain types of pharmacies," the press release said. "Patients, employers, and health plan sponsors could all experience increased costs as they lose access to these pharmacy options, which can deliver significant savings."
But the National Community Pharmacists Association (NCPA), which represents independent pharmacies, likes the law. Without such restrictions, "PBMs will steer patients to pharmacies they own and pay themselves at a much higher rate than they do non-affiliated pharmacies," Anne Cassity, the association's senior vice president for government affairs, said in a phone interview. "And not only are they paying themselves at a higher rate, they're reimbursing non-affiliated pharmacies -- their competitors -- many times at reimbursements below the acquisition cost for the pharmacy. So they're paying [their competitors] below water."
"For folks who really don't pay attention too much to this industry, I like to describe it as Walmart deciding which patients can go to Target, what Target can sell, and how much Target can get paid for selling certain products," she added.
Cassity cited a 2024 audit from the Tennessee Department of Commerce and Insurance that found that CVS Caremark, a PBM that owns the CVS pharmacy chain, paid its affiliated pharmacies 9,927% more for filling a prescription for tadalafil (Cialis) compared with what it paid non-affiliated pharmacies, and 16,510% more for cinacalcet (Sensipar). The data demonstrate that Caremark "engaged in a prohibited practice of reimbursing its affiliates more for a prescription drug or dispensed product than non-affiliates," the audit noted.
Tennessee is one of five states currently considering bills similar to the Arkansas law, according to the Community Oncology Alliance, a trade group for outpatient oncology practices which filed an amicus brief supporting the Arkansas measure. The other states include Arizona, New Jersey, New York, and Pennsylvania.
"Other states considered this same policy proposal in 2025, but did not ultimately land on a true 'ownership' prohibition," James Lee, the alliance's director of state regulation and policy, said in an email. "In both Louisiana and Indiana, proposals were introduced that initially raised the issue of PBM-pharmacy relationships, but final outcomes focused elsewhere and did not squarely resolve pharmacy ownership and control."
While states consider their options in this area, Congress is continuing to scrutinize PBMs. At a House hearing Wednesday, PCMA president and CEO David Marin apologized to lawmakers. "As an association, we have failed you," he said. "We have not done a good enough job articulating PBMs' value to you. We have not been the partner you need. We're going to change that.... My commitment to you today is that we will work with this committee to answer your questions, be a better partner, and help advance solutions that will make it easier and more affordable for your constituents to get the medications they need."
That pledge rang hollow to Cassity, who attended the hearing. "I'm not sure exactly what he's sorry about," she said. "I would suggest that they talk to their member companies about their egregious anti-competitive practices that they continue to perpetrate against pharmacies."
Reflecting on Marin's comment to Rep. Buddy Carter (R-Ga.) -- who owned three independent pharmacies -- that independent pharmacies are "critically important" to PBMs' work, Cassity added, "If independent pharmacies are so important to them and so important to their network, then why is it they continue to practice these egregious contract practices, from below-cost reimbursement to prohibiting certain prescriptions that pharmacies can fill, to steering patients to their own pharmacies?"
PCMA did not respond to a request for comment on this story.
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