PBMs Attempting To Stop Maine Drug Price Disclosure Law

September 3, 2003 (PLANSPONSOR.com) - A group of pharmacy-benefit managers (PBM) plan to file a lawsuit in Maine in an effort to block disclosure legislation from going into effect.

Under the Maine law, scheduled to go into effect on September 13, PBMs would be required to tell their clients about any discounts and rebates they receive if an entity sues a PBM in Maine. This represents a departure for the PBM industry, which negotiates with drug makers on behalf of health insurers. That has traditionally kept their discounts secret, according to a Wall Street Journal report.

The Pharmaceutical Care Management Association (PCMA) – which includes four of the nation’s largest PBMs: AdvancePCS, Medco Health Solutions Inc., Express Scripts Inc. and Caremark Rx Inc. – argues that the reforms violate federal and state laws. Further, the group contends that open-reporting requirements would weaken the PBMs’ ability to receive deep discounts from the drug makers, because rival PBMs, drug makers and regulators would then be able to get pricing information. Knowing that pricing could become public would make drug makers less likely to provide deep discounts, the PCMA says.

Courtroom Skirmishes

Maine’s prescription drug plan, dubbed Maine Rx, is no stranger to the courtroom. In May, p roponents of the state law won a narrow legal victory at the US Supreme Court (See Maine Drug Law Wins Narrow US Supreme Court Victory ).

The high court said that drug makers, who had been battling to keep the law from taking effect, had not proven their case, a ruling that did not give Maine officials the unqualified court endorsement they had been seeking. The program has been on hold pending the outcome of the court battle.

With the indecisive ruling, the Supreme Court justices warned that the program might not survive further court challenges. Nonetheless, the ruling was a defeat for drug makers who claimed that Maine’s program violates federal law.

“By no means will our answer to that question finally determine the validity of Maine’s Rx program,” Justice John Paul Stevens wrote for the court.