Signed into Law: Lankford Provisions Target Drug Middlemen to Lower Prescription Costs for Americans

WASHINGTON, DC - US Senator James Lankford (R-OK) celebrated the signing of the latest federal funding package into law, highlighting key provisions he championed to lower prescription drug costs for American families by cracking down on Pharmacy Benefit Managers (PBMs) and bringing greater transparency to the pricing process. This level of transparency will ensure independent pharmacies receive fair treatment, Medicare dollars are not being inappropriately absorbed by industry middlemen, and savings reach patients at the pharmacy counter.

"For too long, Americans have watched prescription drug costs climb while middlemen in the system take an outsized cut of what should be saving patients money," said Lankford. "For years, I have worked to change the law to prevent pharmacy benefit managers from driving up prices and limiting options for Oklahoma families; Today, my work became law. With this provision now law, we have much greater transparency and accountability to the pricing process so families across Oklahoma and the country can afford the medicines they depend on. This is a win for patients, for pharmacies, and for everyday budgets at pharmacy counters everywhere. There is more work to be done to ensure PBMs are accountable and both pharmacies and patients are treated fairly, but today marks a significant step toward long-needed reforms."

"We're grateful to Senator Lankford for his persistent and unwavering support," said Douglas Hoey, CEO of the National Community Pharmacists Association. "This is the first major PBM reform since the creation of the Medicare Part D program more than 20 years ago. It will help protect patients' freedom of choice, and it will prevent pharmacy benefit managers, the prescription drug divisions of Big Insurance, from using confusing and convoluted contract terms to drive community pharmacies out of business."

Background

The funding package signed into law includes prescription drug pricing reforms drawn from several of Lankford's long-standing bills aimed at lowering costs for patients and protecting access to local pharmacies.

The Protect Patient Access to Pharmacies Act

• Enforces Medicare's "any willing pharmacy" laws, ensuring that pharmacies are given a fair chance to participate in the Medicare pharmacy network and are presented with "reasonable and relevant" contract terms.

Patients Before Middlemen Act

• Ensures pharmacies are given fair and equitable treatment by requiring Part D plans to contract with any willing pharmacy and introduces the designation of essential retail pharmacies to provide better classification in rural and underserved areas.
• Enhances PBM transparency and accountability.
• Prohibits PBM compensation based on the price of a drug as a condition of entering into a contract with a Medicare Part D plan. Under this legislation, PBM service fees would not be connected to the price of a drug, discounts, rebates, or other fees.
• Creates an enforcement mechanism requiring PBMs to pay to the US Department of Health and Human Services any amount in excess of the designated service fees.

Prescription Drug Supply Chain Pricing Transparency Act

• Requires the Government Accountability Office to study and report to Congress on how the current prescription drug supply chain structure incentivizes manufacturers, PBMs, and insurers to set higher drug prices.
• Directs GAO to examine the payment structures across the drug supply chain and how those arrangements impact taxpayer spending, patient out of pocket costs, and potential conflicts of interest.
• Evaluates how financial incentives among manufacturers, PBMs, insurers, and pharmacies contribute to rising prices for patients and taxpayers.

Lankford has long been an advocate for PBM reforms that would increase transparency, ensure community pharmacists are treated fairly, and ensure patients are able to benefit from low-cost prescription drugs.

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