Federal judge blocks Arkansas law barring pharmacy benefit managers from owning pharmacies in state

Key Points

• A federal judge has issued a temporary block on Arkansas' law prohibiting pharmacy benefit managers from owning pharmacies, citing potential discrimination against out-of-state companies.
• The law, signed by Governor Sarah Huckabee Sanders, was set to take effect on August 5 but faced legal challenges from companies like CVS and Express Scripts.
• Supporters argue that the law is necessary to protect independent pharmacies, particularly in rural areas, while opponents caution it could harm consumers and lead to pharmacy closures.
• The Arkansas Attorney General plans to appeal the decision, while CVS expressed satisfaction with the ruling, highlighting their commitment to serving Arkansans.

LITTLE ROCK, Ark. (AP) — A federal judge temporarily blocked on Monday Arkansas' first-in-the-nation law that would have prohibited pharmacy benefit managers from owning pharmacies in the state.

U.S. District Judge Brian Miller issued a preliminary injunction against the law restricting pharmacy benefit managers, who run prescription drug coverage for big clients that include health insurers and employers that provide coverage.

Republican Gov. Sarah Huckabee Sanders signed the restriction into law earlier this year, and it was set to take effect Jan. 1, 2026. CVS and Express Scripts had sued the state over the law.

The law, Miller wrote, "appears to overtly discriminate against plaintiffs as out of state companies and the state has failed to show that it has no other means to advance its interests.”

Republican Attorney General Tim Griffin said he respected the court's decision and planned to appeal.

Supporters of the Arkansas law have said it’s needed because pharmacy benefit managers are forcing independent pharmacies, especially those in rural areas, to close. CVS and Express Scripts in their lawsuits said the restriction would have devastating effects on consumers if it was allowed to take effect.

CVS, which ran TV ads urging Sanders to veto the legislation, has said it would have to close its 23 retail pharmacies in the state if the law takes effect. The company said it was pleased with the decision.

“We continue to be focused on serving people in Arkansas and are actively looking to work together with the state to reduce drug prices and ensure access to pharmacies,” CVS said in a statement.

Arkansas is among several states where lawmakers have taken up efforts to regulate pharmacy benefit managers.

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This story was first published on Jul. 28, 2025. It was updated on Jul. 30, 2025 to correct that the law’s effective date is Jan. 1, 2026, not Aug. 5, 2025.