This bill allows pharmacies to refuse to fill prescriptions if the reimbursement from pharmacy benefit managers (PBMs) is less than the pharmacy's acquisition cost, explicitly excluding Medicaid and Medicaid care management from this provision. It also introduces new requirements for contracts between pharmacies and PBMs, including the obligation for PBMs to provide information on drug pricing sources and to establish a process for appealing maximum allowable cost pricing disputes. The bill amends existing law to include provisions that require PBMs to review and adjust maximum allowable costs every 14 days and mandates that pharmacies be informed of the actual maximum allowable cost for each drug.

Additionally, the bill defines "pharmacy services administrative organization" and establishes that failure to comply with contract requirements will be considered a violation of the consumer protection act. It requires these organizations to provide pharmacies with copies of contracts and payment schedules within three days of execution. The bill also includes a provision that allows pharmacies to decline to provide services if reimbursement is below acquisition cost, while advising patients to contact their PBM for alternative options. The effective date for this act is set for January 1, 2026.