PCMA: Court of Appeals Upholds Challenge to D.C.'s PBM Fiduciary-Disclosure Law
WASHINGTON , April 18, 2008/PRNewswire-USNewswire/ -- The Federal Court of Appeals for the District of Columbia, in a unanimous 3-judge decision, today issued an opinion supporting the position of the Pharmaceutical Care Management Association (PCMA) and holding that it is entitled to renew its constitutional challenge to the fiduciary-disclosure provisions of the District of Columbia's AccessRx Act of 2004.
Last year, a lower court vacated PCMA's original preliminary injunction that had prevented the D.C. law from going into effect. Relying on the doctrine of collateral estoppel, the lower court determined that PCMA was prevented from challenging the law because a similar Maine law had been upheld by the First Circuit Court of Appeals in PCMA v. Rowe.
However, in today's opinion, the D.C. Circuit found that collateral estoppel was not applicable, and could not be used to keep PCMA from having its day in court. The Appeals Court now holds that any such preclusion "would freeze the development of the law in an area of substantial public interest." The case now returns to the lower court for consideration on the merits, including PCMA's contention that the D.C. law conflicts with federal benefits law (ERISA) as well as the First Amendment to the U.S. Constitution.
"We're pleased that the Court has chosen to allow PCMA to pursue this challenge," said PCMA President and CEO Mark Merritt. "PCMA has always maintained that the D.C. law is misguided and would only increase prescription drug costs for District residents and employers."
Since 2003, 31 states have rejected legislation imposing similar PBM fiduciary-disclosure requirements, realizing these proposals would provide drug manufacturers the opportunity to charge consumers and employers higher drug prices. For these reasons, a broad coalition of consumers, Fortune 500 employers, labor unions, health insurers, and others have worked together to defeat these proposals in states across the country. Furthermore, numerous independent data from the Congressional Budget Office, the Federal Trade Commission, and others have concluded that public disclosure of drug pricing information alone could increase prescription drug costs by about 10 percent.
PCMA is the national association representing America's pharmacy benefit managers (PBMs), which administer prescription drug plans for more than 210 million Americans with health coverage provided through Fortune 500 employers, health insurance plans, labor unions, and Medicare Part D.
CONTACT: Charles Cote of PCMA, +1-202-207-3605
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Posted: April 2008