The Patient and Provider Protection Act introduces new regulations for pharmacy benefits managers (PBMs) in New Jersey, emphasizing their fiduciary duty to prioritize the long-term health outcomes of covered individuals. The bill prohibits PBMs from using misleading marketing tactics to influence covered persons to choose contracted or network pharmacies. Additionally, it invalidates any agreements between PBMs and manufacturers that condition rebates on the exclusion of generic drugs from coverage. The bill also mandates that pharmacy and therapeutics committees ensure that higher-cost prescription drugs are not favored over lower-cost generic or biosimilar options in formulary decisions.

Furthermore, the legislation establishes specific reimbursement requirements for PBMs regarding pharmacies. It requires that contracted and network pharmacies be reimbursed at least at the cost of acquiring the prescription drug, while independent pharmacies can be reimbursed at a rate up to five percent lower than the lowest rate for contracted pharmacies, but not below their acquisition cost. The bill also presumes that contracts between PBMs and pharmacies are contracts of adhesion, which may be subject to special scrutiny in disputes. Overall, the act aims to enhance transparency and fairness in the management of pharmacy benefits.

Statutes affected:
Introduced: 17B:27F-3.3, 17B:27F-3.4