The Pharmaceutical Care Management Association has joined the growing list of lawsuits against the state of Tennessee over its new Freedom, Access and Integrity in Registered Pharmacy (FAIR Rx) Act, which bans pharmacy benefit managers from also owning pharmacies in the state.
S.B. 2040, which was signed into law in April, is scheduled to take effect in July 2028. The lawsuit, filed on Tuesday the U.S. District Court for the Middle District of Tennessee, asks for declaratory and injunctive relief.
'S.B. 2040 will hurt the very people lawmakers should be trying to protect," said David Marin, president and CEO of the national association that represents PBMs. "By forcing the closure of more than 160 PBM-affiliated retail, specialty and mail-order pharmacies across the state, lawmakers are creating harmful new barriers for patients. Today, PCMA is asking the court to protect the health of Tennesseans and block a law that disrupts patient care, destabilizes employer-sponsored benefits and conflicts with federal law."
Several major PBMs already have taken legal action. Last week, Express Scripts by Evernorth, the PBM business of The Cigna Group, filled a federal lawsuit challenging the act. CVS Health's Caremark filed a similar lawsuit last month.
Under the law's provisions, Tennessee will not allow a company to own more than 5% of a pharmacy as well as a health insurance issuer and PBM. If a company falls in this category, the pharmacy can continue operating through the end of 2028 but must show the state that it is planning a sale to a separate entity.
Marin argued that this will reduce patient access. "Tennessee patients should not have to worry that a political decision in Nashville will upend the pharmacy services they count on every day, including lifesaving specialty medications and mail-order drugs that help treat chronic conditions," he said.
PCMA, like the PBMS that have sued, said the law creates an uneven playing field for national companies.
"The law also injects instability into one of the most valuable employment benefits -- employer-sponsored insurance," Marin said. "In addition to threatening thousands of jobs, it creates new state-specific requirements for multistate employers trying to provide affordable, consistent benefits to workers across state lines."
Marin believes the court will rule that the law is both harmful and unconstitutional.
"The PBM industry will always stand up for the employers and patients we serve," he said. "The right path forward is clear: protect access to care, preserve employer protections and reject policies that dramatically reduce access to prescription drugs for Tennesseans."
Last year, a federal judge blocked similar legislation in Arkansas, citing federal preemption of state regulations on out-of-state businesses.
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