Sen. Linda Ujifusa and Rep. Rebecca Kislak have introduced a pair of bills to protect Rhode Island’s independent pharmacies as well as consumer choice for prescription drugs.
“Small businesses really drive the Rhode Island economy, and many Rhode Islanders love the responsive and personalized service offered by their local independent pharmacies,” said Senator Ujifusa (D-Dist. 11, Portsmouth, Bristol). “But independent pharmacies are steadily closing under financial stress created by pharmacy benefit managers — PBMs — who work for insurance companies and decide how much to reimburse pharmacies for specific drugs, with little regard for the pharmacy’s costs. Our state should stand up for these important small businesses and require PBMs to treat them fairly.”
Said Representative Kislak (D-Dist. 4, Providence), “I love my independent neighborhood pharmacy. I know that it has gotten more and more difficult for independent pharmacies to compete in the market, and there should be a fair playing field. Our bills are aimed at preventing unfair practices that threaten the survival of independent pharmacies, to protect them and Rhode Islanders’ choices when it comes to where to take their pharmacy business.”
According to Matt Olivier, owner of Matt’s Local Pharmacy in Middletown, “We are forced into take-it-or-leave-it contracts by PBMs that pay us below the actual cost we pay for medications, and they do not tell us where we could have obtained the drugs at the low prices they reimburse us. We provide drugs to patients who could not get them in a timely manner from the big chain stores and suffer significant losses. For example, I’ve been taking a $200 loss recently on a single monthly HIV prescription because I know without this drug, the patient may die. Every day, we see at least 20 to 50 claims where we lose money. This is an unsustainable business practice. We need change and we need it now.”
In response, Senator Ujifusa and Representative Kislak have introduced legislation (2024-S 2395, 2024-H 7720) to require PBMs to reimburse independent pharmacies using the national average drug acquisition cost (NADAC) or the average wholesale acquisition cost, plus a professional dispensing fee.
Among the organizations supporting the bill are Northeast Pharmacy Service Organization, Independent Pharmacy Cooperative and the National Community Pharmacists Association. Several states have already adopted NADAC pricing models, including Arkansas, Georgia, Iowa, Kansas, Kentucky, Louisiana, Michigan, Mississippi, North Carolina and Ohio.
Senator Ujifusa and Representative Kislak have also introduced a bill (2024-S 2605, 2024-H 8143) to limit unnecessary audits imposed by PBMs on independent pharmacies to one every 12 months unless there is a suspicion of fraud or malfeasance.
“I know of a couple Rhode Island independent pharmacies that were audited in December, then audited again less than a few months later for no apparent reason,” according to Ron Lanton, an attorney who represents independent pharmacies. “I hope the fact that the owners had criticized PBM practices at a public hearing was not the trigger.”
Senator Ujifusa and Representative Kislak urge independent pharmacies and their supporters to testify in support of their two bills by emailing the Senate at SLegislation@rilegislature.gov and the House at HouseHealthandHumanServices@rilegislature.gov, with the subject line “In support of 2024-S 2395/ 2024-H 7720 and 2024-S 2605/ 2024-H 8143.” Testimony should state reasons independent pharmacies are valuable and these protections are needed.