American Journal of Law & Medicine

Ninth Circuit Dismisses Pharmacy Benefit Managers' First Amendment Challenge to California Statute Mandating Disclosure of Pharmacies' Retail Drug Pricing Plan - Beeman V. Anthem Prescription Management

Ninth Circuit Dismisses Pharmacy Benefit Managers' First Amendment Challenge to California Statute Mandating Disclosure of Pharmacies' Retail Drug Pricing Plan--Beeman v. Anthem Prescription Management (1)--The United States Court of Appeals for the Ninth Circuit held that a California statute, (2) which requires pharmacy benefit managers (PBMs) to disclose the findings of a biannual drug pricing study to insurers, did not violate the First Amendment. (3)

PBMs are business entities that act as intermediaries between pharmacies and insurers. (4) They reimburse pharmacies for submitted claims according to a networkwide rate that is lower than the rate generally paid by the pharmacies' uninsured, cash-paying customers. (5) California Civil Code section 2527 compels PBMs to report pharmacies' pricing for private uninsured customers to insurers. (6) This allows insurers to compare the PBMs' reimbursement rates against the prices that pharmacies actually charge customers. (7)

Plaintiffs, retail pharmacy owners in California, brought a class action suit against the defendant PBMs ("Defendants") to enforce California Civil Code sections 2527 and 2528. (8) In response, Defendants argued that compelled disclosures, which force individuals to endorse a viewpoint contrary to their own, are unconstitutional under the free speech provisions of the United States and California Constitutions. …

Log in to your account to read this article – and millions more.