Attorney General Josh Stein has called on the Supreme Court to approve state regulation of pharmacy benefit managers (PBMs), arguing that prescription drug costs are excessively high. "Too many prescription drugs are simply too expensive," said Attorney General Stein. "I am urging the court to take this action to better protect North Carolinians from these high costs."
The brief supports Oklahoma's request for the Court to review a decision by the U.S. Court of Appeals for the Tenth Circuit, which held that federal laws preempt Oklahoma laws regulating PBMs. Attorney General Stein and a coalition of Attorneys General argue that this case raises significant federal law questions requiring resolution by the Court, noting conflicts between the Tenth Circuit’s decision, a prior U.S. Supreme Court decision, and similar cases from the Eighth Circuit.
Pharmacy benefit managers act as intermediaries between insurance providers and pharmaceutical companies, creating and maintaining formularies—lists of prescription medications available through specific insurance plans. Drug companies often offer significant rebates to PBMs in exchange for placing their products on these formularies. Although these rebates should theoretically lower medication costs for consumers, PBMs have not been transparent about received rebates, leading to continued increases in prescription drug prices nationwide.
In February, Attorney General Stein led a bipartisan coalition of 39 attorneys general urging Congress to reform PBM operations to help reduce drug costs for Americans.
Joining Attorney General Stein in filing the brief are Attorneys General from Arizona, California, Colorado, Connecticut, Delaware, the District of Columbia, Florida, Hawaii, Illinois, Indiana, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Nebraska, Nevada New Hampshire New Jersey New York Ohio Oregon Pennsylvania Rhode Island South Dakota Texas Utah Virginia Washington