HR 8779
PBM Act
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Bill overview
The Patients Before Monopolies Act, or PBM Act, aims to prevent pharmacy benefit managers (PBMs) and pharmacies from being owned by the same company. It seeks to address concerns about conflicts of interest and reduced competition in the prescription drug market. The bill prohibits vertically integrated health conglomerates from owning pharmacies and requires divestiture if such ownership exists. It also grants federal agencies and state attorneys general the power to enforce these rules and seek remedies for harmed patients.
Key provisions
- Prohibits ownership of pharmacies by entities that also operate pharmacy benefit managers or insurance companies.
- Requires companies with such ownership to divest their pharmacy businesses within one year.
- Grants the FTC and DOJ authority to enforce the law and block transactions that create conflicts of interest.
- Allows individuals harmed by violations to sue for treble damages and attorney’s fees.
- States can bring civil actions on behalf of their residents to address threatened interests.
- Creates a fund to deposit revenue from disgorged prescription drug sales to benefit harmed communities.
- Requires reporting of divestitures to the FTC and DOJ.
- Establishes a process for reviewing the impact of divestitures on competition and the public interest.
Who is affected
- Pharmacy Benefit Managers (PBMs)
- Pharmacies
- Health Plans
- Patients
- Health Care Conglomerates
Notable changes
Sponsors
Official sponsors from legislative records.
Primary sponsor
Cosponsors
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119th CONGRESS — 2d Session
H. R. 8779
IN THE HOUSE OF REPRESENTATIVES
A BILL
To prohibit pharmacy benefit managers and pharmacies from being under common ownership, and for other purposes.
This Act may be cited as the Patients Before Monopolies Act PBM Act
or the
.
The Congress finds the following:
Pharmacy benefit managers are corporate entities that play a dominant role in pharmaceutical supply chains, determining which drugs health plans will cover for enrollees, what prices patients and health plans will pay for those drugs, and how much health plans will reimburse pharmacies for dispensing them.
The market for pharmacy benefit manager services has become highly concentrated. As of 2025, the 6 largest pharmacy benefit managers are each integrated into large health care conglomerates that include downstream businesses such as retail, mail order, and specialty pharmacies. These conglomerates also processed more than 90 percent of the prescriptions in the United States in 2023.
The 3 largest pharmacy benefit managers are also vertically integrated into health care platforms that include both upstream business lines, like health insurance, and downstream suppliers, like pharmacies and providers.
The Federal Trade Commission has found that vertically integrated pharmacy benefit managers have both the ability and incentive to steer business to their own affiliated pharmacies, which reduces competition and increases prescription drug costs for patients.
Pharmacy benefit managers increasingly leverage their market power to pressure smaller, unaffiliated, independent pharmacies to enter into unfavorable contracts with the largest pharmacy benefit managers. This dynamic has likely contributed to the closure of more than 7,000 pharmacies between 2019 and 2024.
Self-preferencing of affiliated pharmacies may also allow large, vertically integrated health conglomerates to evade statutory limits on profits known as the Medical Loss Ratio. Gaming of the profit constraint using transfer pricing techniques may allow affiliated health insurance businesses to hide profits in the unregulated pharmacy business segment, costing enrollees and taxpayers money.
Pursuant to its powers under article I, section 8, of the United States Constitution, Congress has the ability to create any law necessary and appropriate to regulate interstate commerce. As pharmacy benefit managers are part of large, national health conglomerates that operate across state lines, and engage in intrastate activities that also substantially relate to interstate commerce, Congress intends to regulate pharmacy benefit managers in the public interest.
In order to eliminate the conflicts of interest described in paragraphs (1) through (7) and restore competition to the marketplace, the Federal Government should—
protect patients, independent pharmacies, and taxpayers by structurally separating vertically integrated health conglomerates;
require parent companies that own a pharmacy benefit manager or insurer to divest their pharmacy businesses;
enable Federal agencies, state attorneys general, and private citizens to bring civil actions to enforce the structural separation of these companies; and
grant the Federal Trade Commission and Department of Justice additional authority to review and block future transactions that would re-create these conflicts of interest.
directly or indirectly own, operate, control, or direct the operation of the whole or any part of a pharmacy; and
directly or indirectly own, operate, or control the whole or any part of—
Not later than 1 year after the date of enactment of this Act, any person in violation of paragraph (1) shall divest the pharmacy of such person.
If divestiture does not occur by the deadline under subsection (a)(2), a divestiture trustee shall oversee the divestiture required under that paragraph. The divestiture trustee shall have the authority to sell the pharmacy.
When the Inspector General of the Department of Health and Human Services, the Assistant Attorney General in charge of the Antitrust Division of the Department of Justice, the Federal Trade Commission, or an attorney general of a State has reason to believe that a person is in violation of subsection (a), such Inspector General, Assistant Attorney General, Federal Trade Commission or attorney general of a State may bring a civil action in an appropriate district court of the United States.
An individual alleging damages as a result of a violation of this Act may bring a civil action in any court of competent jurisdiction, State or Federal.
In a civil action brought under subparagraph (A) in which the plaintiff prevails, the court may award—
treble damages;
reasonable attorney’s fees and litigation costs; and
any other relief, including equitable or declaratory relief, that the court determines appropriate.
If the attorney general of a State has reason to believe that an interest of the residents of the State has been or is being threatened or adversely affected by a practice that violates subsection (a), the attorney general of the State may, as parens patriae, bring a civil action on behalf of the residents of the State in an appropriate district court of the United States to obtain appropriate relief, including monetary damages.
Either party, upon request, shall have the right to a jury trial.
Any revenue received from the sale of prescription drugs disgorged pursuant to an action under paragraph (1) shall be deposited in a fund created by the Federal Trade Commission and distributed by the Federal Trade Commission to be put to use in the interest of serving the health care needs of the harmed community, including consumers overcharged at vertically integrated pharmacies.
Any divestment of a pharmacy or pharmacy benefit manager required under subsection (a) shall be reported to the Federal Trade Commission and the Assistant Attorney General in charge of the Antitrust Division of the Department of Justice under section 7A of the Clayton Act (15 U.S.C. 18a) without respect to the thresholds under subsection (a)(2) of that section.
With respect to each divestiture undertaken pursuant to subsection (a), in addition to any applicable review under section 7A of the Clayton Act (15 U.S.C. 18a), the Federal Trade Commission and the Assistant Attorney General in charge of the Antitrust Division of the Department of Justice shall review the effect on competition, financial viability, and the public interest—
The Federal Trade Commission and the Assistant Attorney General in charge of the Antitrust Division of the Department of Justice, jointly or separately, may bring a civil action in any court of competent jurisdiction to block any action that would harm competition to the detriment of the public interest with respect to the conflicts of interest described in subsection (a).
The Federal Trade Commission shall promulgate rules to carry out this section. Such rules shall not diminish any obligation under this section.
The Chair of the Federal Trade Commission and the Assistant Attorney General in charge of the Antitrust Division of the Department of Justice shall submit to the appropriate congressional committees quarterly reports on compliance with this Act, including the status of any divestitures required under this Act.
Nothing in this section shall be construed to limit the authority of the Federal Trade Commission, the Inspector General of the Department of Justice, the Department of Health and Human Services, or the attorney general of a State under any other provision of law.
If any provision of this Act or the application thereof to any person or circumstance is held invalid, the remainder of this Act, or the application of that provision to persons or circumstances other than those as to which it is held invalid, shall not be affected thereby.
The term health plan means any public or private health insurance plan.
The term person has the meaning given the term in section 8 of the Sherman Act (15 U.S.C. 7).
any organization the National Provider Identifier (NPI) registration of which has 1 or more taxonomy codes under the pharmacy section of the National Uniform Claim Committee (or a subsequent organization); and
The term pharmacy benefit manager means any person, business, or other entity, such as a third-party administrator, regardless of whether such person, business, or entity identifies itself as a pharmacy benefit manager, that, either directly or indirectly through an intermediary (including an affiliate, subsidiary, or agent) or an arrangement with a third party—
acts as a negotiator of prices, rebates, fees, or discounts for prescription drugs on behalf of a health plan or health plan sponsor;
contracts with pharmacies to create pharmacy networks and designs and manages such networks; or
manages or administers the prescription drug benefits provided by a health plan, including the processing and payment of claims for prescription drugs, arranging alternative access to or funding for prescription drugs, the performance of utilization management services, including drug utilization review, the processing of drug prior authorization requests, the adjudication of appeals or grievances related to the prescription drug benefit, contracting with network pharmacies, controlling the cost of covered prescription drugs, or the provision of related services.