Supreme Court Declines to Hear Challenge to Oklahoma Pharmacy Law
WASHINGTON D.C. – July 1, 2025 – the nation’s highest court has rejected a petition to review a lower court decision that invalidated key provisions of an Oklahoma law designed to regulate pharmacy benefit managers (PBMs). The Supreme Court’s action, announced yesterday, effectively upholds a 2023 ruling from the 10th U.S.Circuit Court of Appeals. This decision leaves in place a judgment that four components of Oklahoma’s House Bill 2632 are superseded by existing federal regulations.
The contested legislation, enacted with the aim of bolstering access to self-reliant pharmacies and fostering competition against industry giants like CVS Caremark and OptumRx, faced legal opposition from the Pharmaceutical Care Management Association (PCMA), the leading trade institution representing PBMs. The PCMA initially filed a lawsuit in 2019, arguing the state law overstepped its authority. While a district court initially sided largely with Oklahoma, that ruling was overturned on appeal.
The solicitor General of the United States previously advised the Supreme Court against taking up the case, a recommendation the justices followed. this outcome signals a notable win for PBMs and raises questions about the extent to which states can regulate these powerful intermediaries in the pharmaceutical supply chain.
The Core of the Dispute: PBM Regulation
Pharmacy benefit managers act as negotiators between drug manufacturers and health insurers, creating formularies and processing prescription drug claims.Critics argue that PBMs lack clarity and can drive up drug costs through opaque practices.Oklahoma’s law sought to address these concerns by requiring PBMs to meet certain standards regarding network adequacy, reimbursement rates, and disclosure of financial arrangements.
The 10th Circuit court found that these state-level requirements clashed with the Employee Retirement Income Security Act (ERISA), a federal law governing employee benefit plans.The court determined that ERISA preempts state laws that “relate to” employee benefit plans, effectively shielding PBMs from certain state regulations.
Here’s a breakdown of the key aspects of the case:
| Aspect | Details |
|---|---|
| State | Oklahoma |
| Law Challenged | House Bill 2632 (regulating PBMs) |
| Plaintiff | Pharmaceutical care Management Association (PCMA) |
| Court Ruling | Four provisions preempted by federal law (ERISA) |
| Appellate Court | 10th U.S. Circuit Court of appeals |
| Supreme Court Action | Declined to review the 10th Circuit’s ruling |
