The PBM Act prohibits pharmacy benefit managers and health insurance companies from owning pharmacies at the same time, aiming to eliminate conflicts of interest in the drug pricing system. Companies currently operating in violation of this rule must divest their pharmacy businesses within one year of the law's enactment. The Federal Trade Commission and Department of Justice will enforce compliance, with penalties including monthly escrow of ten percent of profits for companies that miss divestment milestones. The legislation also allows federal agencies, state attorneys general, and individuals to file civil lawsuits against violators, with successful plaintiffs potentially receiving triple damages, attorney fees, and other relief. Congress cited concerns that major health conglomerates own both pharmacy benefit managers that set drug prices and the pharmacies that dispense drugs, giving them incentives to steer business to their own pharmacies while steering patients away from independent competitors, contributing to thousands of pharmacy closures since 2019.
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