New Jersey S2345: Patient and Provider Protection Act-concerns

What the bill says

An Act concerning pharmacy benefits managers and amending and supplementing various parts of the statutory law. 1. (New section) The Legislature finds and declares: a. Pharmacy benefits managers administer prescription drug benefits for health insurers, employers, union health plans, and public programs, and exercise substantial authority over formulary design, rebate negotiations, pharmacy reimbursement, and patient access to medications within the State of New Jersey. b. Pharmacy benefits managers occupy a central position in the prescription drug supply chain, negotiating rebates and discou.

From the committee substitute text, October 5, 2026:

An Act concerning pharmacy benefits managers and amending and supplementing various parts of the statutory law. 1. (New section) The Legislature finds and declares: a. Pharmacy benefits managers administer prescription drug benefits for health insurers, employers, union health plans, and public programs, and exercise substantial authority over formulary design, rebate negotiations, pharmacy reimbursement, and patient access to medications within the State of New Jersey. b. Pharmacy benefits managers occupy a central position in the prescription drug supply chain, negotiating rebates and discounts with drug manufacturers, determining pharmacy network participation, and influencing the out-of-pocket costs borne by patients. c. The 2024 bipartisan report issued by the U.S. House Committee on Oversight and Government Reform entitled “The Role of Pharmacy Benefit Managers in Prescription Drug Markets” found that the largest pharmacy benefits managers control a dominant share of prescription drug claims, are frequently vertically integrated with major insurers and affiliated pharmacies, and derive significant revenue from manufacturer-paid rebates and price concessions tied to formulary placement and list prices. d. The Federal Trade Commission, in its first interim report “Pharmacy Benefit Managers: The Powerful Middlemen Inflating Drug Costs and Squeezing Main Street Pharmacies,” released in 2024, found that pharmacy benefits managers exercise significant market power, operate through opaque rebate and spread pricing arrangements, and may reimburse independent pharmacies at rates that threaten their …