CVS Health followed through quickly on its promise to sue Tennessee if Gov. Bill Lee signed a bill requiring the company to divest its pharmacy benefit management arm, filing a lawsuit in federal court shortly after the bill became law.
One of the battles over Senate Bill 2040 centers on whether pharmacy benefit managers harm local pharmacies. The Tennessee Pharmacists Association says they do.
"If you talk to any independently owned pharmacy, they struggle to have any level of negotiation with the big PBMs," Anthony Pudlo, CEO of the Pharmacists Association, said in an interview with The Center Square before the bill passed. "They're also being audited by that company and then they can see everything that they're doing and then they can control how much that pharmacy wants to get paid. I even refer to it as you have a PBM that ends up being the judge, jury and executioner of a local, independent pharmacy because they control the contracts as well as they audit their competition and then change the rules to make it work for their own pharmacies."
CVS said in its lawsuit, filed Friday in the U.S. District Court for the Middle District of Tennessee, that the law would force 160 retail and specialty pharmacies, including 136 of its own, to close, putting thousands of Tennesseans out of work.
