Pharmacists file brief to back law

Challenged 2015 statute affects reimbursements for generic drugs

The Arkansas Pharmacists Association and the National Community Pharmacists Association have filed a “friend of the court” brief in support of Arkansas’ challenged 2015 law that governs how pharmacists are reimbursed for generic drugs.

On March 1, Chief U.S. District Judge Brian Miller threw out a lawsuit filed in Little Rock by the Pharmaceutical Care Management Association, a Washington, D.C.-based national trade group that said Act 900 of 2015 was simply a way for pharmacists to make more money at the expense of benefits plans.

The association said the law would result in higher costs for the plans and patients, and that it disrupts the uniformity that “maximum allowable costs” lists provide for pharmacy networks across the country.

The association appealed part of Miller’s order to the 8th U.S. Circuit Court of Appeals in St. Louis, and Arkansas Attorney General Leslie Rutledge filed a cross-appeal.

The state and national pharmacist groups announced Friday they have also filed a brief in the case at the 8th Circuit.

The groups said Act 900 was passed by state lawmakers in “response to the unregulated drug middlemen known as pharmacy benefit managers (PBMs) who for years have used pricing models that consistently left pharmacists paying more for prescription medications than they were reimbursed for from the PBMs.”

“Year after year, PBMs chip away at Arkansas’ pharmacists’ ability to cover the costs of life-saving medications so that the drug middlemen can line their pockets and satisfy investors,” the announcement said, quoting Scott Pace, the chief executive officer and executive vice president of the Arkansas Pharmacists Association.

The association appealed part of Miller’s order to the 8th U.S. Circuit Court of Appeals in St. Louis, and Arkansas Attorney General Leslie Rutledge filed a cross-appeal.

In granting summary judgment — a ruling based purely on the law, without a need for testimony — Miller noted that “independent community pharmacies have had to eliminate employees during the last five to 10 years due to the financial hardships they have faced. The Arkansas legislature passed and amended Arkansas Code Annotated section 17-92-507 in an attempt to address this issue.”

He did side with the benefits managers, however, on their argument the Arkansas law is invalid as applied to their administration and management of plans governed by the Employment Retirement Income Security Act of 1974.

Miller said he believed the state law didn’t interfere with, or pre-empt, the federal law, but because the 8th Circuit had reversed another judge’s similar ruling, he tailored his ruling accordingly.

The pharmacists associations said Friday that Act 900 “established appeals standards for Arkansas pharmacies” when the benefits managers set the reimbursement rates for generic medications below the drug acquisition cost of the pharmacies, “resulting in pharmacists losing money in order to fill a prescription.”

They called Act 900 “a necessary law that places basic protections in place for retail pharmacies in Arkansas from below-cost reimbursement.”