Independent Pharmacy Organizations Call for Support of Iowa PBM Bill

On October 6, the National Community Pharmacists Association (NCPA), Iowa Pharmacy Association (IPA), American Pharmacists Association (APhA), and Independent Pharmacy Cooperative (IPC) issued a brief for the US Court of Appeals to reject a recent challenge toward Iowa’s Senate File 383 (SF 383) regulating pharmacy benefit managers (PBMs) in the state. According to an NCPA news release, the groups are calling on the federal government to reverse the challenge against SF 383 brought on by business groups and insurance companies seemingly against the law.¹

“States have faced a crisis of access to pharmacy care within their borders, and according to numerous independent studies, PBMs are the chief culprits,” wrote authors of the amicus brief.² “In the last few decades, the business practices of PBMs have shuttered countless pharmacies—including in rural communities. In response, nearly all states have enacted laws regulating PBMs.”

One of those laws, and the reasoning behind ongoing clashes between pharmacy groups and business or insurance groups, is Iowa’s SF 383. The law was designed to significantly limit the power of PBMs in Iowa through prohibiting a variety of common practices.

READ MORE: Iowa Governor Signs Bill Limiting PBM Practices

First, the law takes away PBMs’ ability to reduce patients’ choice of pharmacies as well as excluding specific pharmacies from PBM networks. The law also prohibits PBMs from imposing requirements outside of state regulations, forcing mail-order use, or improperly classifying specific drugs to restrict access.³

Since the file was signed into law on June 11, the aforementioned insurance and business groups have fought to reverse it. Because of these groups, as well as other advocates like Iowa State Insurance Commissioner Doug Ommen, a lower court issued an injunction to prohibit the state’s enforcement of SF 383.¹

From June of this year up until the brief filed on Monday, Iowa and its push for PBM reform has garnered increased attention when it comes to state-level pharmacy legislation.

“It’s a flimsy legal argument that was already unanimously rejected by the US Supreme Court in 2020,” said NCPA CEO Douglas Hoey, RPh, MBA.¹ “Since that decision, almost every state in the country has passed or introduced some kind of PBM reform to stop their egregious practices.”

According to the opposers of SF 383, the law should not be enforceable because it was preempted by the federal ERISA statute of 1974, or the Employee Retirement Income Security Act. With preemption of state laws under ERISA, the business and insurance groups argue that state laws cannot be enacted that would impede on PBMs’ regulation of insurance benefit plans.

The independent pharmacy groups, as stated in their brief, were then forced to call attention to the fact that PBMs are mere administrators of insurance plans rather than acting as the plans themselves.

“Under ERISA, preemption of state laws is not automatic; it requires a federal court decision,” wrote authors of a WTW article.⁴ “Whether or not ERISA preemption could affect some or all of the provisions of the state PBM law will depend on the terms of the actual law being implemented and the courts’ interpretation of that law.”

With the latest action of note within this entire phenomenon being the pharmacy groups’ amicus brief, there is uncertainty surrounding the future of SF 383. As of now, the injunction blocking the law is still standing, but the courts can, and certainly may, revisit questions surrounding this law. With statutes like ERISA in play amid constant work among many states to enact PBM reform, the final results of these deliberations could have significant impacts on the future of the pharmacy and prescription drug benefits industries.⁵

“Iowa has the right, and the responsibility, to stop PBM tactics that close community pharmacies and harm patients,” concluded Matthew Pitlick, PharmD, BCPS, CEO and executive vice president of IPA, according to the release. “SF 383 is a common-sense check on middlemen and it’s essential to preserving access in rural Iowa where a single closure can leave an entire county without care. We’re proud to stand with NCPA, APhA, and IPC to protect patient access in Iowa.”

READ MORE: How the Big 3 PBMs Utilize Various Market Strategies

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REFERENCES

1. Independent pharmacy groups back Iowa PBM regulation in federal court. News Release. NCPA. October 8, 2025. Accessed October 8, 2025. https://ncpa.org/newsroom/news-releases/2025/10/08/independent-pharmacy-groups-back-iowa-pbm-regulation-federal

2. Smith R, Gray T. Brief of National Community Pharmacists Association, Iowa Pharmacy Association, American Pharmacists Association, and Independent Pharmacy Cooperative as amici curiae in support of defendant-appellant and affirmance in part and reversal in part. Katten Muchin Rosenman LLP. October 6, 2025. Accessed October 8, 2025. https://ncpa.org/sites/default/files/2025-10/AmicusBrief-IowaAssocOfBusinessAndIndustryEtAl-v-IowaInsuranceCommissioner.pdf

3. Nowosielski B. Iowa governor signs bill limiting PBM practices. Drug Topics. June 12, 2025. Accessed October 8, 2025. https://www.drugtopics.com/view/iowa-governor-signs-bill-limiting-pbm-practices

4. Gogna A, Lupin B. Does ERISA preemption mean that state PBM laws won’t apply to my self-insured plan? WTW. March 20, 2025. Accessed October 8, 2025. https://www.wtwco.com/en-us/insights/2025/03/does-erisa-preemption-mean-that-state-pbm-laws-wont-apply-to-my-self-insured-plan

5. Santiago A, Gilboa DR, Carnegie TC, et al. Federal court temporarily halts Iowa’s PBM reform law amid legal challenges. Mintz. July 8, 2025. Accessed October 8, 2025. https://www.mintz.com/insights-center/viewpoints/2146/2025-07-08-federal-court-temporarily-halts-iowas-pbm-reform-law