The supreme Court will not review an appeals court ruling that struck down meaningful portions of an Oklahoma law regulating the retail networks of pharmacy benefit managers (PBMs). The U.S. solicitor general recommended against the review.

Enacted in 2019, the Oklahoma law aimed to ensure PBMs maintain broad pharmacy access and prevent them from steering patients to preferred pharmacies. This legislative effort arose from growing concerns that opaque PBM practices were inflating prescription drug costs for consumers and health plans, ofen at the expense of independent pharmacies.

The Pharmaceutical Care Management Association (PCMA), a PBM trade group, challenged the law, arguing that Oklahoma was improperly trying to interfere with the administration of health plans designed to promote affordable patient choices. The PCMA specifically contended that the law was preempted by the Employee retirement income Security Act (ERISA) and the Medicare Part D program.

Legal Challenges and Industry Response

The PCMA’s lawsuit argued that the Oklahoma law conflicted with federal regulations governing employee benefits and Medicare, thus overstepping state authority.The appeals court sided with the PCMA, leading to Oklahoma’s appeal to the Supreme Court, which has now been effectively denied.

The Pharmaceutical Care Management Association (PCMA) contended that the law was preempted by the Employee Retirement Income security Act (ERISA).

Implications of the Decision

This decision marks a setback for state efforts to regulate PBMs and control prescription drug costs. It reinforces the argument that federal laws preempt state regulations in this area, perhaps limiting states’ ability to address concerns about PBM practices.

consumer advocates and independent pharmacists have expressed disappointment, arguing that the lack of regulation allows PBMs to continue practices that inflate drug prices and limit patient choice. The debate over PBM regulation is likely to continue at both the state and federal levels.