Q&A: NACDS President and CEO on PBM Reform and Grassroots Advocacy

Steven C. Anderson, FASAE, CAE, IOM, president and CEO of the National Association of Chain Drug Stores (NACDS), sat down with Drug Topics during the 2024 NACDS Total Store Expo to discuss the challenges of pharmacy benefit managers (PBMs) in the current market and the importance of grassroots advocacy in powering Congressional reform.

Drug Topics: How can PBMs and their practices be regulated to ensure fair competition and transparency in the industry?

Steven C. Anderson:They don't have transparency now; they don't they don't foster competition. It's a highly consolidated market, with the “Big 3” PBMs controlling about 90% of the business.

We've been very active at the federal and state level on this. We've helped enact 150 new laws over the last 3 years. We're working on Capitol Hill on this issue, and at the regulatory [level]. The Federal Trade Commission has been investigating PBMs for 2 years. They issued an interim report last month [in July 2024], and we're hoping that the final report will come out and in [the report] there will be certain recommendations that they're suggesting to make the market more competitive.

At the same time, [PBMs are] forcing pharmacies to accept these contracts that are untenable; it's not sustainable. PBMs have been hiding behind this complexity—the opaqueness—of the industry, of people not understanding it, and now people are beginning to understand. We've got bipartisan support in a polarized Congress. We have Republicans and Democrats fully understanding PBMs, where in the past they really didn't understand it. It was complicated… Try to tell a member of Congress what a direct and indirect or remuneration fee…is, and what a PBM is… Now they get it. As their understanding deepens, their voices rise, their eyes kind of light up, saying, ‘We're going to fix this, because it's not good for our country.’

READ MORE: New Report Scrutinizes PBM Spread Pricing Practice

Drug Topics: How can pharmacies leverage their collective voice to maintain momentum and pressure congress to act on PBM reforms?

Anderson: There's a strength in the power of the voters. [As] we’re coming into this election year…we find members of Congress being much more responsive when they're on the ballot, right? You have the whole House of Representatives up for reelection this year, and about one-third of the Senate.

We have mobilized an incredible grassroots network of people within pharmacy to contact their members of Congress. We do congressional pharmacy tours; we get the Senators and we get the House members into the pharmacies, so they can actually get behind the pharmacy counter and see [not only] what the pharmacist does from a broader health and wellness issue in addition to dispensing drugs, but also about the potential of, they could do much, much more that they're currently not allowed to do, or are not getting paid for.

When they get in there, members of Congress realize, on the PBM issue, that PBMs hurt their constituents, our [pharmacist’s] patients. They hurt employers; they raise costs for employers, not cut costs for employers, and they're destroying communities. They're forcing pharmacies to close and having people drive very long distances to get their prescriptions filled by a pharmacist. That grassroots network is really one of our great powers at NACDS. It's really a superpower, I guess I would call it.

The 2024 NACDS Total Store Expo was held August 17 to August 19, 2024, in Boston, Massachusetts. Click here for more of our coverage.