HHS Secretary Designee Becerra Questioned
on Role of PBMs During Confirmation Hearings

This week, both the Senate HELP and Finance Committees held hearings on the nomination of Attorney General Xavier Becerra (D-Calif.) to be Secretary of HHS. In the HELP Committee hearing, two freshman Republican Senators, Tommy Tuberville (Ala.) and Roger Marshall (Kan.), asked Becerra about the role of PBMs and how he would handle their impacts on pharmacies and patients (video is available here starting at 2:42). Sen. Tuberville stressed that rural pharmacies are going out of business because of PBM practices, which could cause access problems. Becerra alluded to the role he played in supporting the Rutledge v. PCMA case, which would give states more ability to rein in PBM practices, but he also noted there was a need for federal oversight and reform of PBMs. Overall, Democrats are strongly supportive of Becerra’s nomination, while Republicans appear to be uniformly opposed because of Becerra’s record on abortion, expansion of the Affordable Care Act, and Medicare For All. While it has not yet been scheduled, Becerra will face a vote in the Senate Finance Committee possibly as soon as next week to advance his nomination to the Senate Floor.

NCPA Files Amicus Curiae Brief in Compounding Litigation

NCPA, in conjunction with other interested stakeholders in the compounding pharmacy space, filed an amicus curiae brief in the Wellness Pharmacy, Inc. v. Cochran case. At the center of the litigation is the October 26, 2020 Memorandum of Understanding (MOU) between the FDA and approving States - which would govern distribution requirements for compounding pharmacies preparing drugs for interstate patients. States which did sign the MOU would have Board of Pharmacy reporting requirements to the FDA for compounders shipping over 50% of their products interstate, while compounders in States which did not sign would have a limit of 5% of their products available for interstate patients. As a result of the publication of the MOU for signature, the plaintiffs allege the FDA did not properly follow Administration Procedure Act (APA) protocols and in crafting the document, the agency conflates “dispensing” and “distribution”. NCPA raises these issues before the Court and expresses the concern over the legality of the actions of the FDA and the significant compliance burdens and impacts placed on compounders – especially those close to State borders or with a specialty patient population.

Research Group Releases Report on Optimizing
Medication Outcomes Including NCPA Panelists

The RAPID Alliance Research Consortium, a research collaborative of which NCPA is a founding participant, released the RAPID Alliance 2021 Report, a set of consensus strategies for protecting and improving health for millions of Americans while saving as much as $200 billion per year by optimizing outcomes of medications and related therapies. The RAPID Alliance Research Consortium, a multi-sector, multi-university collaborative, has been formed to conduct research to support implementation of prioritized strategies. NCPA members can download a free copy of the report here. The website also has information about participating in upcoming research projects and accessing additional study results.

FDA Issues Warning on Use of COVID-19
Treatment in Compounding

On February 24, 2021, the FDA issued a warning on the use of certain active pharmaceutical ingredients by compounders for the treatment of COVID-19. The agency issued a warning on the use of Thymosin alpha-1. Thymosin is not a component of an approved drug and therefore unavailable for use in compounding under both sections 503A and 503B of the Food, Drug, and Cosmetic Act. The FDA is aware of its use in compounded products for patients for the treatment of COVID-19 and the agency states it will take appropriate action against compounders who utilize this ingredient, as thymosin is not approved to treat any condition. Please visit the FDA website on Compounding and COVID-19 for more information.

Alabama PBM Legislation Protects Patient Choice

SB 227, introduced by Senator Tom Butler (R), is a pro-patient, pro-local community pharmacy bill. The legislation will help put an end to PBM conflicts of interests that raise costs for patients and payers and that limit access to local community pharmacies. This bill:

• Protects patients from PBM conflicts of interest: PBMs own their own pharmacies, and they often force patients to use those pharmacies, many of which are out-of-state mail-order pharmacies with no face-to-face interaction with a pharmacist. SB 227 will protect a patient’s right to choose the in-network pharmacy that is right for the patient, not the PBM.
• Protects local pharmacies from anticompetitive PBM practices: PBMs arbitrarily refuse some local pharmacies from participating in provider networks, which makes it easier for PBMs to steer patients to PBM-owned pharmacies. SB 227 will require PBMs to give pharmacies the opportunity to compete with those PBM-owned pharmacies for patients’ business.
• Creates Transparency between PBMs and Payers: PBMs use very complicated pricing schemes, that benefit themselves at the expense of the ultimate payers, the health benefit plans and those enrolled in the plans. SB 227 will put a stop to these costly practices by requiring PBMs to act as the health benefit plan’s fiduciary, benefitting all those enrolled in the plan.

SB 227 provides much needed transparency for the patient when it comes to the cost of the medications. It is a common-sense solution to ensure patients know the lowest cost option for their prescription drug; ensure patients continue to have access to the pharmacy of their choice; to prohibit self-dealing by PBMs and to provide a level playing field for local community pharmacies so they may continue providing healthcare to patients in Alabama, particularly those in underserved areas of the state. Link to the bill can be found here.

Florida Bills take Aim at Medicaid Managed Care Reform

A pair of bills introduced in Florida seek to reform the flawed Medicaid managed care pharmacy benefit. Florida SB 1306, introduced by Senator Ana Rodriguez (R) and HB 1043, introduced by Rep. Randy Fine (R), both make major changes to Florida’s current Medicaid managed care program. These bills:

• Require the state to contract with a single PBM, by October 2021, to administer the Medicaid managed care pharmacy benefit.
• Require the PBM to have a fiduciary duty to the state.
• Require a full pass-through pricing model; “spread pricing” is prohibited.
• Require reimbursement at the Medicaid fee for service (FSS) level-both ingredient cost and dispensing fee, as well as use the FSS preferred drug list.
• Prohibit mandatory mail order and exclusion from a network if willing to accept reasonable terms and conditions set by the single PBM.

If this legislation passes, Florida will join a multitude of states like West Virginia, New York, Ohio, Louisiana (just to name a few) who have made major changes to their respective Medicaid managed care programs over the last several years. Links to the bills can be found here.

NCPA Submits Letter of Support for Hawaii Legislation

NCPA submitted a letter of support for SB 975 from Hawaii, which would establish fair pharmacy audit requirements. Although the bill establishes pharmacy audit protections, it had been amended during the committee process in ways that weaken its provisions. While expressing support for the bill, NCPA urged lawmakers to remove those amendments.

Michigan Introduces Comprehensive PBM Licensure Bill

Michigan introduced HB 4348, a PBM licensure bill that addresses reimbursement, network adequacy, and other PBM issues. NCPA has worked with Michigan legislative staff in the development of this legislation.

NCPA Presents SCOTUS Overview to Tennessee Pharmacists

NCPA staff offered an overview of the Rutledge v. PCMA Supreme Court case to members of the Tennessee Pharmacists Association. NCPA’s presentation focused on the implications of the ruling for states and their efforts to enact PBM regulations.

NCPA State Legislative Activity Update

NCPA tracks state legislation related to our top three state priorities: Medicaid reform, scope of practice and compensation for services, and PBM reform and regulation. Click each issue for a report of bills that have been introduced so far this session specifically dealing with these three issue areas. You can access the individual bill language and basic information on the bill by clicking on the bill numbers in the attached report. Bills that have moved this week are listed at the top in the “Recently Updated” section.

NCPA’s Advocacy Center Update provides a weekly detailed summary of recent and breaking legislative, regulatory, and state developments impacting independent community pharmacy and NCPA’s efforts to affect policies benefitting its membership and the industry. The weekly update is distributed to NCPA leadership, steering committees, allied organizations/stakeholders and major contributors to the NCPA LDF and PAC. The weekly update is intended exclusively for the recipient and is not for external distribution.