CVS, Express Scripts Sue to Overturn Arkansas Law Banning PBMs From Owning Pharmacies
In the suit, the companies claim the law puts an unconstitutional restriction on interstate commerce.
CVS Health and Express Scripts filed lawsuits Thursday in an attempt to overturn Arkansas Act 624, which bans pharmacy benefit managers (PBMs) from owning a pharmacy business in the state.1,2 The companies claimed the law poses an unconstitutional restriction on interstate commerce because it burdens those that operate outside of Arkansas.
“Act 624 is designed to target CVS Health, not to protect patients,” wrote CVS Health in a statement.1 “Arkansas lawmakers crafted the law to exclude CVS Health’s pharmacy operations while protecting in-state pharmacy businesses, which often charge higher prices. There is no way around the fact that Act 624 will limit patients’ options and increase the cost of their medicines.”
CVS, which operates the PBM affiliate CVS Caremark, currently owns 23 pharmacies in Arkansas and has said the law would force it to close all the locations. For Express Scripts, which is the PBM operating under the Cigna Group, they claim that the law will likely hinder access to mail-order prescriptions.2
Arkansas Act 624 is set to go into effect on January 1, 2026. | image credit: mehaniq41 / stock.adobe.com
READ MORE: As a Result of PBM Reform, CVS Will Close Over 20 Pharmacies in Arkansas
According to Sam Dubke, a spokesperson for Arkansas Governor Sarah Huckabee Sanders who signed the law, companies like CVS and Express Scripts are only trying to protect themselves by issuing the lawsuits.
“These big drug middlemen are only attacking Arkansas in the courts because they’re worried other states will join Governor Sanders in fighting for patient access and affordable prescriptions,” Dubke told Reuters.2
The gravity behind Arkansas Act 624 underscores the ongoing pressures between PBMs and the independent community pharmacies struggling to keep their doors open because of depleting profit margins. While companies like CVS claim they are providing care at reasonable prices to millions of Americans, other pharmacies are blaming PBMs for the inability to stay financially sustainable in an independent business.
PBM practices and their impacts on pharmacies and drug pricing have been known to pharmacy industry experts for years. However, the most recent event that significantly boosted the public’s awareness of PBM practices was the Federal Trade Commission (FTC) interim staff report on prescription drug middlemen, the term often used for PBMs.
“The report finds that PBMs wield enormous power over patients’ ability to access and afford their prescription drugs, allowing PBMs to significantly influence what drugs are available and at what price,” wrote authors of the report.3 “The interim report also finds that PBMs hold substantial influence over independent pharmacies by imposing unfair, arbitrary, and harmful contractual terms that can impact independent pharmacies’ ability to stay in business and serve their communities.”
Since the interim report, pharmacy industry advocates and PBMs have been butting heads, with each entity looking toward legislation and lawsuits to protect their businesses. One of the bigger wins for independent pharmacies has been Arkansas Act 624, legislation that advocates hope will cause a domino effect and continue to limit PBM power in other states.
However, just as Governor Sanders believes CVS and Express Scripts’ actions are to avoid this domino effect, on the opposite end, Cigna does not believe Act 624 will benefit Arkansans. “While Arkansas politicians claim this law was designed to lower drug prices and increase access to medications, it will do just the opposite,” said Cigna’s Chief Legal Officer Andrea Nelson, JD.2
With the law going into effect in January 2026, PBMs like CVS Caremark and Express Scripts will continue to negotiate prescription drug prices in all 50 states. The PBMs’ main opposers, such as community pharmacies and their advocates, will continue to be vocal in state capitols and in Congress, fighting for someone to step in to pull back the power of PBMs.
“Facts should matter more than rhetoric, and a simple economic analysis could have avoided all this chaos. Factoring in both closures AND openings, there are 14 more independent pharmacies operating in Arkansas today than there were in 2019, and CVS Caremark reimburses independent pharmacies in Arkansas more than it does CVS pharmacies. Small businesses, employers, health plans, and others are going to have to pay more for prescription drugs starting next year because of this new law,” concluded CVS Health in its statement.1
READ MORE: PBM Reform Necessary for Access to Medicare Part D Drugs
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References
1. CVS Health files lawsuit to protect Arkansans from Act 624. News Release. CVS Health. May 29, 2025. Accessed May 30, 2025. https://www.cvshealth.com/news/company-news/cvs-health-files-lawsuit-to-protect-arkansans-from-act-624.html
2. Jones DN. CVS, Express Scripts sue to block Arkansas law barring PBM ownership of pharmacies. Reuters. May 30, 2025. Accessed May 30, 2025. https://www.reuters.com/business/healthcare-pharmaceuticals/express-scripts-sues-block-arkansas-law-barring-pbm-ownership-pharmacies-2025-05-29/
3. FTC releases interim staff report on prescription drug middlemen. News Release. FTC. July 9, 2024. Accessed May 30, 2025. https://www.ftc.gov/news-events/news/press-releases/2024/07/ftc-releases-interim-staff-report-prescription-drug-middlemen
