CVS warns bill will close 134 Tennessee pharmacies
CVS issued a warning saying Tennessee’s bill would jeopardize the closure of 134 pharmacies, including MinuteClinic, and affect more than 2,000 jobs.
CVS sued Tennessee officials on May 22, seeking to block a bill the pharmacy giant said would force the chain to close 136 stores in the state.
CVS filed the lawsuit in U.S. District Court in Nashville after Tennessee Governor Bill Lee signed a bill banning companies from owning both pharmacy benefit managers and retail pharmacies. Tennessee law goes into effect on July 1, 2028.
CVS employs more than 2,000 people at 134 retail and two specialty pharmacy locations in Tennessee, providing medical services and medications to people with complex conditions such as cancer and multiple sclerosis. The company also owns CVS Caremark, a pharmacy benefits manager.
“We are exhausting every option at our disposal to continue providing pharmacy and health care services to Tennessee’s 1.5 million pharmacy patients,” CVS spokeswoman Amy Thibault said in a statement. “This unconstitutional law puts special interests and local politics above patients, restricts access to life-saving medicines, and undermines fair competition.”
Pharmacy benefit managers (PBMs) are attracting bipartisan scrutiny across the country as Congress and states take aim at prescription drug prices and big health care companies. PBMs act as intermediaries between drug manufacturers, health insurance companies, and retail pharmacies. Health insurance companies and employers that provide health insurance benefits use PBMs to negotiate prices and manage prescription drugs.
Sens. Elizabeth Warren (D-Mass.) and Josh Hawley (R-Missouri) reintroduced federal legislation similar to Tennessee’s law this month. The bipartisan bill would ban companies that own PBMs and insurance companies from owning pharmacies.
B. Douglas Hoey, CEO of the National Association of Community Pharmacists, which represents independent pharmacies, said Tennessee’s law addresses a “huge conflict of interest” when large corporations control pharmacies, PBMs and insurance companies.
“This law simply gives these big healthcare companies a choice: they can be a PBM or a pharmacy, but not both,” Hoey said in a statement.
Thibault said Tennessee’s law targets CVS and raises prescription drug costs for employers and does not lower prescription drug costs for anyone.
The lawsuit names the Tennessee Board of Pharmacy, Tennessee Attorney General Jonathan Scumetti, and 10 Board of Pharmacy officials as defendants. The lawsuit asks a federal judge to find the bill violates federal law and block states from enforcing it.
