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07/01/2021

NACDS brief supports North Dakota PBM-regulation law

NACDS has filed an amicus brief with the 8th U.S. Circuit Court of Appeals supporting North Dakota's law regulating PBMs and pointing to recent precedent from the Supreme Court to inform the appeals court's ruling.
David Salazar
Managing Editor
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As an appeals court takes up a case examining a North Dakota law regulating pharmacy benefit management companies, the National Association of Chain Drug Stores is lending its support to the state with an amicus brief. NACDS’ brief to the U.S. Court of Appeals for the 8th Circuit highlights a precedent set in the recent Supreme Court case, Rutledge versus Pharmaceutical Care Management Association. 

Like Rutledge, at question in the North Dakota case, also brought by the PCMA, is whether states can enact laws regulating PBMs, or whether such laws are 1 by the federal Employee Retirement Income Security Act, or ERISA. 

[Read More: Pharmacy orgs welcome Supreme Court upholding Arkansas PBM law]

“Rutledge versus Pharmaceutical Care Management Association makes clear that ERISA does not preempt North Dakota’s statute,” according to the NACDS brief. “ERISA does not disable states from protecting the interests of pharmacies and the communities they serve merely because the state law may have indirect economic effects on health care plans.”

The brief argues that the law regulates the relationship between pharmacies and PBMs, which are not part of ERISA plans, and that Rutledge found the impact of such laws on the relationship between PBMs and ERISA plans does not necessitate ERISA preemption. 

“The statute is designed to mitigate a health care crisis: the rampant closure of pharmacies,” according to the brief. “Pharmacies not only dispense medications, but also provide front-line health care like immunizations, tobacco cessation, hormonal contraceptive therapies, blood pressure, glucose testing, flu shots, and information to customers on a variety of health-related matters. When a pharmacy closes in a rural area, local residents may have no alternative health care provider nearby, leading to the risk of noncompliance with medication regimens and poor health outcomes.”

NACDS also filed an amicus brief in the Rutledge case, which the Supreme Court ruled on in December, upholding an Arkansas law that PCMA challenged, claiming that the law was preempted by ERISA. 

To read the full brief NACDS filed for the North Dakota law, click here

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