The Alabama Senate has passed SB252, the Community Pharmacy Relief Act, a measure aimed at regulating pharmacy benefits managers to ensure independent pharmacies receive fairer reimbursements and increased transparency in drug pricing.
SB252, sponsored by State Sen. Billy Beasley (D-Clayton), seeks to address concerns over PBM practices that lawmakers and pharmacists argue lead to unfair reimbursements and increased patient costs. The bill prohibits PBMs from reimbursing independent pharmacies at rates lower than those paid by Alabama Medicaid for prescription drugs, a provision set to last for two years. It also bans PBMs from charging additional fees for network participation or claims processing and ensures that pharmacists cannot be prevented from informing consumers about lower-cost alternatives. Additionally, PBMs must pass 100% of manufacturer rebates to health plans instead of retaining them for profit.
The bill gives enforcement authority to the Alabama Insurance Commissioner, who can impose civil penalties for violations. It also allows pharmacists, pharmacies, and insurance beneficiaries to sue PBMs for damages. Further restrictions prevent PBMs from steering patients to affiliated pharmacies, engaging in spread pricing, or penalizing pharmacies that refuse to dispense drugs at unsustainably low reimbursement rates.
Senate President Pro Tem Garlan Gudger (R-Cullman), a leading proponent of the bill, emphasized the economic burden PBM regulations have placed on independent pharmacies across Alabama.
“Everyone understands that consistently selling a product for less than you bought it is a recipe for bankruptcy, closure, and economic failure, but small-town drugstores and independent pharmacies in every area of the state are forced to do exactly that under the current regulations,” Gudger said.
“The legislation approved by the Senate is a pro-business measure that simply levels the competition for businesses of all sizes, ranging from hometown, mom-and-pop pharmacies to the largest retail drug chains,” he continued. “Most importantly, it shields consumers from having to pay higher costs at the cash register for the medicines they need to remain healthy and survive.”
Gudger criticized opposition to the bill, arguing that concerns over cost increases are being driven by powerful corporate interests.
“The only opposition to the legislation comes from special interests making annual revenues in the billions of dollars and profits in the hundreds of millions each year,” he said. “Small independent pharmacists are among the most trusted and respected individuals in our communities, especially in the rural parts of Alabama, and it is our job to ensure they operate under fair and impartial regulations.”
SB252 was amended on the Senate floor before passage. An amendment from State Sen. Shay Shelnutt (R-Trussville) clarified that the bill does not apply to specialty drugs or impact a hospital’s ability to require its employees to use a hospital-owned pharmacy. Another amendment, introduced by Gudger, modified the bill’s implementation timeline. While most provisions would take effect immediately upon Gov. Kay Ivey’s signature, a key section establishing minimum reimbursement standards for independent pharmacies would take effect on Oct. 1, 2025.
Supporters of SB252, including independent pharmacists and patient advocates, argue the bill is a necessary step toward fairness and transparency in the prescription drug supply chain. The Retirement Systems of Alabama and other healthcare industry groups, however, have opposed SB252, citing concerns that the bill could lead to increased costs for state insurance plans and taxpayers.
The bill now moves to the Alabama House of Representatives for consideration.
Grace Heim is a state and political reporter for Yellowhammer News. You can follow her on X @graceeheim or email her at [email protected].
