AG Davenport Joins 45-State Coalition Supporting Proposed DOL Rule on PBM Transparency

AG Davenport, Bipartisan Coalition Support Federal Rule to Increase PBM Transparency in Drug Pricing

AG Davenport, Bipartisan Coalition Support Federal Rule to Increase PBM Transparency in Drug Pricing

by NJOAG Communications WC | Apr 16, 2026 | (PBMs) | Bipartisan Coalition | comment letter | Department of Labor | Division of Consumer Affairs | drug pricing | Employee Retirement Income Security Act of 1974 (ERISA) | employer-funded health plans | inflate prices | prescription drug programs | proposed U.S. Department of Labor rule | rebates and reimbursements with drug manufacturers | state regulators | transparency from pharmacy benefit managers | Affordability | Press Release |

Pharmacy Benefit Managers Affect Affordability of Prescription Drugs, Hurting Patients and Taxpayers

For Immediate Release: April 16, 2026

Office of the Attorney General
– Jennifer Davenport, Attorney General

For Further Information:

Media Inquiries-
Allison Inserro
OAGpress@njoag.gov

View Comment Letter

TRENTON — Attorney General Jennifer Davenport and a bipartisan coalition of 44 other attorneys general filed a comment letter in support of a proposed U.S. Department of Labor rule that would require transparency from pharmacy benefit managers (PBMs) that service employer-funded health plans.

PBMs are third-party administrators of prescription drug programs for health insurers and health plans. Governor Mikie Sherrill called for more oversight into these middlemen in her budget address in March, noting that New Jersey’s Medicaid program would save $20 million annually if PBMs were not allowed to inflate prices.

“We all feel the financial pain of rising drug prices, but it doesn’t have to be this way,” said Attorney General Davenport. “We’re standing together with a bipartisan coalition of attorneys general in urging the federal government to increase oversight over PBMs. Our office is committed to ensuring that PBMs are following the law—and to hold them accountable when they don’t.”

Created in the late 1960s to process prescription drug claims, PBMs now play a far broader and more powerful role in the health care system by managing prescription drug benefits for health insurers.

This includes, among other things, negotiating rebates and reimbursements with drug manufacturers and determining which drugs are covered and at what cost.

Approximately 136 million Americans receive health coverage through an employer—either their own job or a family member’s—and the proposed rule responds to concerns that employers often lack visibility into how PBMs are making money or why drug costs change. It would require PBMs to disclose twice a year how they generate revenue and would give employers the right to audit them.

PBMs have also long sought to avoid state regulation by claiming federal preemption under ERISA. The attorneys general urge the Department of Labor to clarify that the proposed rule does not preempt state PBM transparency laws. PBMs have long sought to avoid state regulation by claiming federal preemption under the Employee Retirement Income Security Act of 1974 (ERISA).

Further, in the comment letter, the attorneys general ask the Department of Labor to commit to collaborating with state regulators to achieve transparency. According to the coalition, the final rule should mention that nothing in the rule is intended to prevent the Department of Labor from referring matters to state attorneys general, requesting their investigative or enforcement assistance, or coordinating with them when the department discovers violations of state law.

Today, the top three PBMs manage approximately 80% of prescription drug claims. Due to the power imbalance held by PBMs and the negative effects of such power on drug pricing, all fifty states, the District of Columbia, and Puerto Rico have enacted laws to rein them in. In recent years, New Jersey has enacted several laws that apply to PBMs, including one that requires PBMs to report pricing information to the Division of Consumer Affairs and provides for civil penalties if they fail to report.

In submitting today’s comment letter, Attorney General Davenport joins the attorneys general of Alaska, American Samoa, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, the District of Columbia, Georgia, Hawaii, Idaho, Illinois, Indiana, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Nevada, New Hampshire, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Vermont, Virginia, Washington, West Virginia, and Wyoming.

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