Sixth Circuit Rejects Tennessee Law on Pharmacy Benefit Managers

The Sixth Circuit ruled Tuesday that a Tennessee law on pharmacy benefit managers is preempted by federal law, in the latest loss for states attempting to curb an industry they blame for putting local pharmacies out of business.

McKee Foods Corp. challenged portions of Tennessee’s law under the Employee Retirement Income Security Act, arguing that provisions blocking financial incentives for patients to use certain pharmacies and requiring PBMs to partner with “any willing pharmacy” that accepts its terms are preempted.

Judges David W. McKeague, Chad A. Readler, and Stephanie Dawkins Davis of the US Court of Appeals for the Sixth ...