I
119THCONGRESS
1
STSESSION H. R. 2214
To improve services provided by pharmacy benefit managers.
IN THE HOUSE OF REPRESENTATIVES
MARCH18, 2025
Mrs. M
ILLER-MEEKS(for herself, Ms. BARRAGA´N, Ms. MALLIOTAKIS, Mr.
S
CHNEIDER, Mr. ALLEN, and Mr. NORCROSS) introduced the following
bill; which was referred to the Committee on Energy and Commerce, and
in addition to the Committees on Ways and Means, and Education and
Workforce, for a period to be subsequently determined by the Speaker,
in each case for consideration of such provisions as fall within the juris-
diction of the committee concerned
A BILL
To improve services provided by pharmacy benefit managers.
Be it enacted by the Senate and House of Representa-1
tives of the United States of America in Congress assembled, 2
SECTION 1. SHORT TITLE. 3
This Act may be cited as the ‘‘Delinking Revenue 4
from Unfair Gouging Act’’ or the ‘‘DRUG Act’’. 5
SEC. 2. IMPROVING PHARMACY BENEFIT MANAGER SERV-6
ICES. 7
(a) P
UBLICHEALTHSERVICEACT.—Part D of title 8
XXVII of the Public Health Service Act (42 U.S.C. 9
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300gg–111 et seq.) is amended by adding at the end the 1
following: 2
‘‘SEC. 2799A–11. IMPROVING PHARMACY BENEFIT MANAGER 3
SERVICES. 4
‘‘(a) I
NGENERAL.—Beginning on January 1, 2027, 5
except as provided in subsection (b), a pharmacy benefit 6
manager shall derive no remuneration from any entity for 7
services, benefit administration, or any other activities re-8
lated to prescription drug benefits under a group health 9
plan or group or individual health insurance coverage. 10
‘‘(b) E
XCEPTION FORBONAFIDESERVICEFEES.— 11
‘‘(1) I
N GENERAL.—A pharmacy benefit man-12
ager may charge an entity a bona fide service fee for 13
the provision of services to such entity only if such 14
fee is set forth in an agreement between the phar-15
macy benefit manager and such entity and the 16
amount of any bona fide service fee— 17
‘‘(A) is a flat dollar amount; and 18
‘‘(B) is not directly or indirectly based on, 19
or contingent upon— 20
‘‘(i) a drug price (such as wholesale 21
acquisition cost) or drug benchmark price 22
(such as average wholesale price); 23
‘‘(ii) the amount of discounts, rebates, 24
fees, or other direct or indirect remunera-25
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tion with respect to prescription drugs pre-1
scribed to the participants, beneficiaries, or 2
enrollees in the group health plan or health 3
insurance coverage involved; or 4
‘‘(iii) any other amounts specified by 5
the Secretary, the Secretary of Labor, and 6
the Secretary of the Treasury; 7
‘‘(2) D
EFINITIONS.—In this section— 8
‘‘(A) the term ‘bona fide service fee’ means 9
a fee that is equal to the fair market value of 10
a bona fide, itemized service that is actually 11
performed on behalf of an entity, that the enti-12
ty would otherwise perform (or contract for) in 13
the absence of the service arrangement, and 14
that is not passed on in whole or in part to a 15
client or customer, whether or not the entity 16
takes title to the drug; and 17
‘‘(B) the term ‘pharmacy benefit manager’ 18
means any person, business, or other entity, 19
such as a third-party administrator, regardless 20
of whether it identifies itself as a pharmacy 21
benefit manager, that, either directly or 22
through an intermediary (including an affiliate, 23
subsidiary, or agent) or an arrangement with a 24
third-party— 25
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‘‘(i) acts a price negotiator for pre-1
scription drugs on behalf of a group health 2
plan or health insurance issuer offering 3
group or individual health insurance cov-4
erage; or 5
‘‘(ii) manages or administers the pre-6
scription drug benefits provided by a group 7
health plan or health insurance issuer of-8
fering group or individual health insurance 9
coverage, including creating formularies, 10
the processing and payment of claims for 11
prescription drugs, arranging alternative 12
access to or funding for prescription drugs, 13
the performance of drug utilization review, 14
the processing of drug prior authorization 15
requests, the adjudication of appeals or 16
grievances related to the prescription drug 17
benefit, contracting with network phar-18
macies (including retail and mail phar-19
macies), controlling the cost of covered 20
prescription drugs, or the provision of re-21
lated services. 22
‘‘(c) E
NFORCEMENT.— 23
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‘‘(1) IN GENERAL.—The Secretary, in consulta-1
tion with the Secretary of Labor and the Secretary 2
of the Treasury, shall enforce this section. 3
‘‘(2) D
ISGORGEMENT.—The pharmacy benefit 4
manager shall disgorge to a group health plan or 5
health insurance issuer offering group or individual 6
health insurance coverage any payment, remunera-7
tion, or other amount received by the pharmacy ben-8
efit manager or an affiliate of such pharmacy benefit 9
manager from such plan or issuer in violation of 10
subsection (a) or, pursuant to subsection (b), the 11
agreement entered into with such plan or issuer for 12
bona fide service fees. 13
‘‘(3) P
ENALTIES.—A pharmacy benefit man-14
ager that violates subsection (a) or (b) shall be sub-15
ject to a civil monetary penalty in the amount of 16
$10,000 for each day during which such violation 17
continues. 18
‘‘(4) P
ROCEDURE.—Notwithstanding section 19
2723, the provisions of section 1128A of the Social 20
Security Act, other than subsection (a) and (b) and 21
the first sentence of subsection (c)(1) of such sec-22
tion, shall apply to civil monetary penalties under 23
this subsection in the same manner as such provi-24
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sions apply to a penalty or proceeding under section 1
1128A of the Social Security Act. 2
‘‘(d) R
EGULATIONS.—Notwithstanding any other 3
provision of law, the Secretary, in consultation with the 4
Secretary of Labor and the Secretary of the Treasury, 5
shall implement this section through interim final regula-6
tions. 7
‘‘(e) R
ULES OFCONSTRUCTION.—Nothing in this 8
section shall be construed— 9
‘‘(1) as prohibiting payments related to reim-10
bursement for ingredient costs to entities that ac-11
quire prescription drugs or pharmacy dispensing 12
fees; and 13
‘‘(2) to prohibit rebates, discounts, or other 14
price concessions from being fully passed through to 15
a group health plan or health insurance issuer offer-16
ing group or individual health insurance coverage to 17
lower net costs for prescription drugs.’’. 18
(b) ERISA.— 19
(1) I
N GENERAL.—Subpart B of part 7 of sub-20
title B of title I of the Employee Retirement Income 21
Security Act of 1974 (29 U.S.C. 1185 et seq.) is 22
amended by inserting after section 725 the fol-23
lowing: 24
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‘‘SEC. 726. IMPROVING PHARMACY BENEFIT MANAGER 1
SERVICES. 2
‘‘(a) G
ENERAL.—Beginning on January 1, 2027, ex-3
cept as provided in subsection (b), a pharmacy benefit 4
manager shall derive no remuneration from any entity for 5
services, benefit administration, or any other activities re-6
lated to prescription drug benefits under a group health 7
plan or group health insurance coverage. 8
‘‘(b) E
XCEPTION FORBONAFIDESERVICEFEES.— 9
‘‘(1) I
N GENERAL.—A pharmacy benefit man-10
ager may charge an entity a bona fide service fee for 11
the provision of services to an entity only if such fee 12
is set forth in an agreement between the pharmacy 13
benefit manager and such entity and the amount of 14
any bona fide service fee— 15
‘‘(A) is a flat dollar amount; and 16
‘‘(B) is not directly or indirectly based on, 17
or contingent upon— 18
‘‘(i) a drug price (such as wholesale 19
acquisition cost) or drug benchmark price 20
(such as average wholesale price); 21
‘‘(ii) the amount of discounts, rebates, 22
fees, or other direct or indirect remunera-23
tion with respect to prescription drugs pre-24
scribed to the participants, beneficiaries, or 25
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enrollees in the group health plan or health 1
insurance coverage involved; or 2
‘‘(iii) any other amounts specified by 3
the Secretary, the Secretary of Health and 4
Human Services, and the Secretary of the 5
Treasury. 6
‘‘(2) D
EFINITIONS.—In this section— 7
‘‘(A) the term ‘bona fide service fee’ means 8
a fee that is equal to the fair market value of 9
a bona fide, itemized service that is actually 10
performed on behalf of an entity, that the enti-11
ty would otherwise perform (or contract for) in 12
the absence of the service arrangement, and 13
that is not passed on in whole or in part to a 14
client or customer, whether or not the entity 15
takes title to the drug; and 16
‘‘(B) the term ‘pharmacy benefit manager’ 17
means any person, business, or other entity, 18
such as a third-party administrator, regardless 19
of whether it identifies itself as a pharmacy 20
benefit manager, that, either directly or 21
through an intermediary (including an affiliate, 22
subsidiary, or agent) or an arrangement with a 23
third-party— 24
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‘‘(i) acts a price negotiator for pre-1
scription drugs on behalf of a group health 2
plan or health insurance issuer offering 3
group health insurance coverage; or 4
‘‘(ii) manages or administers the pre-5
scription drug benefits provided by a group 6
health plan or health insurance issuer of-7
fering group health insurance coverage, in-8
cluding creating formularies, the proc-9
essing and payment of claims for prescrip-10
tion drugs, arranging alternative access to 11
or funding for prescription drugs, the per-12
formance of drug utilization review, the 13
processing of drug prior authorization re-14
quests, the adjudication of appeals or 15
grievances related to the prescription drug 16
benefit, contracting with network phar-17
macies (including retail and mail phar-18
macies), controlling the cost of covered 19
prescription drugs, or the provision of re-20
lated services. 21
‘‘(c) E
NFORCEMENT.—The Secretary shall enforce 22
this section as provided for in section 502(c)(13). 23
‘‘(d) R
EGULATIONS.—Notwithstanding any other 24
provision of law, the Secretary, in consultation with the 25
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Secretary of Health and Human Services and the Sec-1
retary of the Treasury, shall implement this section 2
through interim final regulations. 3
‘‘(e) R
ULES OFCONSTRUCTION.—Nothing in this 4
section shall be construed— 5
‘‘(1) as prohibiting payments related to reim-6
bursement for ingredient costs to entities that ac-7
quire prescription drugs or pharmacy dispensing 8
fees; and 9
‘‘(2) to prohibit rebates, discounts, or other 10
price concessions from being fully passed through to 11
a group health plan or health insurance issuer offer-12
ing group health insurance coverage to lower net 13
costs for prescription drugs.’’. 14
(2) E
NFORCEMENT.—Section 502 of the Em-15
ployee Retirement Income Security Act of 1974 (29 16
U.S.C. 1132) is amended— 17
(A) in subsection (a)(6), by striking ‘‘or 18
(9)’’ and inserting ‘‘(9), or (13)’’; and 19
(B) in subsection (c), by adding at the end 20
the following: 21
‘‘(13) S
ECRETARIALENFORCEMENTAUTHORITYRE-22
LATING TOPHARMACYBENEFITMANAGERSERVICES.— 23
‘‘(A) D
ISGORGEMENT.—With respect to a viola-24
tion of section 726 by a pharmacy benefit manager, 25
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such pharmacy benefit manager shall disgorge to a 1
group health plan or health insurance issuer offering 2
group health insurance coverage any payment, remu-3
neration, or other amount received by the pharmacy 4
benefit manager or an affiliate of such pharmacy 5
benefit manager from such plan or issuer in viola-6
tion of subsection (a) of such section or, pursuant to 7
subsection (b) of such section, the agreement en-8
tered into with such plan or issuer for bona fide 9
service fees. 10
‘‘(B) P
ENALTIES.—A pharmacy benefit man-11
ager that violates subsection (a) or (b) of section 12
726 shall be subject to a civil monetary penalty in 13
the amount of $10,000 for each day during which 14
such violation continues. 15
‘‘(C) P
ROCEDURE.—Except as provided in this 16
paragraph, the provisions of this section shall apply 17
to civil monetary penalties under this paragraph in 18
the same manner as such provisions apply to other 19
civil penalties under this section. 20
‘‘(D) R
ULE OF CONSTRUCTION .—Nothing in 21
this paragraph shall effect the authority of the Sec-22
retary under subsection (a)(5).’’. 23
(3) C
LERICAL AMENDMENT .—The table of con-24
tents in section 1 of the Employee Retirement In-25
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come Security Act of 1974 (29 U.S.C. 1001 et seq.) 1
is amended by inserting after the item relating to 2
section 725 the following new item: 3
Sec. 726. Improving pharmacy benefit manager services.
(c) INTERNALREVENUECODE OF1986.— 4
(1) I
N GENERAL.—Subchapter B of chapter 5
100 of the Internal Revenue Code of 1986 is amend-6
ed by adding at the end the following: 7
‘‘SEC. 9826. IMPROVING PHARMACY BENEFIT MANAGER 8
SERVICES. 9
‘‘(a) I
NGENERAL.—Beginning on January 1, 2027, 10
except as provided in subsection (b), a pharmacy benefit 11
manager shall derive no remuneration from any entity for 12
services, benefit administration, or any other activities re-13
lated to prescription drug benefits under a group health 14
plan. 15
‘‘(b) E
XCEPTION FORBONAFIDESERVICEFEES.— 16
‘‘(1) I
N GENERAL.—A pharmacy benefit man-17
ager may charge an entity a bona fide service fee for 18
the provision of services to such entity only if such 19
fee is set forth in an agreement between the phar-20
macy benefit manager and such entity and the 21
amount of any bona fide service fee— 22
‘‘(A) is a flat dollar amount; and 23
‘‘(B) is not directly or indirectly based on, 24
or contingent upon— 25
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‘‘(i) a drug price (such as wholesale 1
acquisition cost) or drug benchmark price 2
(such as average wholesale price); 3
‘‘(ii) the amount of discounts, rebates, 4
fees, or other direct or indirect remunera-5
tion with respect to prescription drugs pre-6
scribed to the participants, beneficiaries, or 7
enrollees in the group health plan involved; 8
or 9
‘‘(iii) any other amounts specified by 10
the Secretary, the Secretary of Health and 11
Human Services, and the Secretary of the 12
Labor. 13
‘‘(2) D
EFINITIONS.—In this section— 14
‘‘(A) the term ‘bona fide service fee’ means 15
a fee that is equal to the fair market value of 16
a bona fide, itemized service that is actually 17
performed on behalf of an entity, that the enti-18
ty would otherwise perform (or contract for) in 19
the absence of the service arrangement, and 20
that is not passed on in whole or in part to a 21
client or customer, whether or not the entity 22
takes title to the drug; and 23
‘‘(B) the term ‘pharmacy benefit manager’ 24
means any person, business, or other entity 25
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such as a third-party administrator, regardless 1
of whether it identifies itself as a pharmacy 2
benefit manager, that, either directly or 3
through an intermediary (including an affiliate, 4
subsidiary, or agent) or an arrangement with a 5
third-party— 6
‘‘(i) acts as a price negotiator for pre-7
scription drugs on behalf of a group health 8
plan; or 9
‘‘(ii) manages or administers the pre-10
scription drug benefits provided by a group 11
health plan, including creating formularies, 12
the processing and payment of claims for 13
prescription drugs, arranging alternative 14
access to or funding for prescription drugs, 15
the performance of drug utilization review, 16
the processing of drug prior authorization 17
requests, the adjudication of appeals or 18
grievances related to the prescription drug 19
benefit, contracting with network phar-20
macies, controlling the cost of covered pre-21
scription drugs, or the provision of related 22
services. 23
‘‘(c) E
NFORCEMENT.— 24
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‘‘(1) IN GENERAL.—The Secretary, in consulta-1
tion with the Secretary of Health and Human Serv-2
ices and the Secretary of Labor, shall enforce this 3
section. 4
‘‘(2) D
ISGORGEMENT.—The pharmacy benefit 5
manager shall disgorge to a group health plan any 6
payment, remuneration, or other amount received by 7
the pharmacy benefit manager or an affiliate of such 8
pharmacy benefit manager from such plan or issuer 9
in violation of subsection (a) or, pursuant to sub-10
section (b), the agreement entered into with such 11
plan for bona fide service fees. 12
‘‘(3) P
ENALTIES.—A pharmacy benefit man-13
ager that violates subsection (a) or (b) shall be sub-14
ject to a civil monetary penalty in the amount of 15
$10,000 for each day during which such violation 16
continues. 17
‘‘(4) P
ROCEDURE.—The provisions of section 18
1128A of the Social Security Act, other than sub-19
section (a) and (b) and the first sentence of sub-20
section (c)(1) of such section, shall apply to civil 21
monetary penalties under this subsection in the 22
same manner as such provisions apply to a penalty 23
or proceeding under section 1128A of the Social Se-24
curity Act. 25
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‘‘(d) REGULATIONS.—Notwithstanding any other 1
provision of law, the Secretary, in consultation with the 2
Secretary of Health and Human Services and the Sec-3
retary of Labor, shall implement this section through in-4
terim final regulations.’’. 5
(2) C
LERICAL AMENDMENT .—The table of sec-6
tions for subchapter B of chapter 100 of the Inter-7
nal Revenue Code of 1986 is amended by adding at 8
the end the following new item: 9
‘‘Sec. 9826. Improving pharmacy benefit manager services.’’.
Æ
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