Arkansas Law Banning PBM-Owned Pharmacies Faces Eighth Circuit Review
Arkansas's new law banning PBM ownership of pharmacies is under federal court review.
Why it matters: This case could shape national standards on regulating pharmacy benefit managers' vertical integration and impact future healthcare reforms.
- Arkansas enacted Act 624 on April 16, 2025, banning PBMs from owning pharmacies, effective January 1, 2026.
- A federal judge blocked the law on July 28, 2025, citing Commerce Clause and federal preemption concerns.
- The Eighth Circuit heard arguments on September 22, 2026, on the law's constitutionality and scope.
- Arkansas argues the ban prevents PBMs' anti-competitive practices and protects local pharmacies.
- Judge Brian Miller noted the law also protects out-of-state, non-PBM pharmacies, raising legal questions.
Arkansas passed a pioneering law, House Bill 1150 (Act 624), signed by Governor Sarah Huckabee Sanders on April 16, 2025, to prohibit pharmacy benefit managers (PBMs) from owning or operating pharmacies within the state. This legislation was slated to take effect on January 1, 2026, attacking what Arkansas views as anti-competitive conduct enabled by vertical integration between PBMs and pharmacies.
The state contends that allowing PBMs such ownership creates "an irresistible opportunity for those PBMs to engage in predatory and anti-competitive practices," as stated by Joseph Nelson, attorney representing Arkansas in the case. Arkansas aims to protect local pharmacies and ensure fair competition in the pharmacy market.
However, U.S. District Judge Brian Miller issued a preliminary injunction on July 28, 2025, halting enforcement of Act 624. Judge Miller's ruling highlighted constitutional concerns, including potential violations of the Commerce Clause and federal preemption, noting that the statute appears focused not only on PBM-owned pharmacies but also aims to shield locally operated and out-of-state non-PBM pharmacies like Walgreens.
The dispute advanced to the Eighth Circuit Court of Appeals, where arguments were held on September 22, 2026. The appeals court will examine the balance between state regulatory authority versus federal law and constitutional protections.
The final ruling could set a national precedent on regulating PBM vertical integration, likely influencing the approaches other states take on healthcare sector reforms and pharmacy benefit management oversight.
By the numbers:
- April 16, 2025 — Arkansas enacts Act 624 banning PBM pharmacy ownership
- January 1, 2026 — Act 624 scheduled to go into effect
- July 28, 2025 — Federal judge blocks enforcement of Act 624
- September 22, 2026 — Eighth Circuit hears arguments on the case
Yes, but: While Arkansas focuses on anti-competitive risks, the federal court cautions that the law also protects non-PBM pharmacies, complicating constitutional assessments.
What's next: The Eighth Circuit's forthcoming decision will clarify the law's enforceability and set a precedent affecting similar regulations nationally.