The bill amends Chapter 176D of the General Laws to establish new regulations regarding pharmacy benefit managers (PBMs) and their reimbursement practices to pharmacies in the Commonwealth. It introduces a new section, 3C, which defines key terms such as "maximum allowable cost list," "pharmacy acquisition cost," and "pharmacy benefits manager affiliate." The bill mandates that before a PBM can place a drug on its maximum allowable cost list, the drug must meet specific criteria, including being therapeutically and pharmaceutically equivalent and available for purchase from wholesalers in the Commonwealth. Additionally, the bill requires PBMs to provide timely access to their maximum allowable cost lists, update them promptly in response to price changes, and establish a reasonable administrative appeal process for pharmacies to challenge reimbursements.

Furthermore, the bill stipulates that PBMs cannot reimburse pharmacies at a rate lower than what they pay their affiliates for the same services, calculated on a per unit basis. It allows pharmacies to refuse to provide services if the reimbursement would be less than their acquisition cost. The provisions also apply to PBMs contracted with MassHealth or the group insurance commission. Violations of this section are classified as deceptive and unfair trade practices under existing law.