Frier Levitt has learned that Express Scripts, Inc. (ESI) recently began notifying pharmacies that network re‑contracting will commence soon, with material reimbursement and term changes possible under new templates ESI has deployed in recent years. Pharmacies should look for offers sent by email or fax. Historically, PBM re-contracting solicitations have included tight response windows and default enrollment mechanics if no timely response is received. Careful review and affirmative opt‑out/objection, where appropriate, is critical.
Legislative Backdrop Favors Greater Contract Fairness
Recent federal action and proposals target PBM contracting practices in Medicare Part D, including delinking PBM compensation from drug prices, enhanced audit/reporting rights, and Centers for Medicare & Medicaid Services (CMS) direction to define “reasonable and relevant” pharmacy contract terms under the Any Willing Pharmacy framework. States continue to advance PBM reforms with particular focus on fair reimbursement, anti‑steering, and network protections. The changing legal landscape creates additional leverage points for pharmacies to utilize during negotiations with PBMs.
ESI Settlement with FTC May Affect Contracting
ESI recently settled a case with the Federal Trade Commission (FTC) related to insulin pricing, but the settlement has wide-reaching implications beyond insulin that include contracts with pharmacies. No later than January 1, 2028 (but as soon as “commercially possible”), ESI must provide retail pharmacies standard terms that include (1) “cost-plus” pricing (i.e., acquisition cost plus a dispensing fee); and (2) additional payments for all Non-Dispensing Services performed by Retail Community Pharmacies. It remains to be seen whether the upcoming contract offer will include these terms.
Action Steps for Pharmacies
- Carefully Review All ESI Communications: Do not ignore network notices, contract amendments or other PBM communication. In past instances, silence by the pharmacy could result in ESI taking this as a pharmacy’s agreement to revised terms. Ensure that your pharmacy is aware of all communications and is aware of all deadlines.
- Evaluate Impact of Diverse State and Federal Laws: Assess proposed terms against emerging federal Part D standards and your state’s PBM statutes to identify negotiable risk areas and statutory defenses.
How Frier Levitt Can Help
Frier Levitt has extensive experience negotiating with PBMs and deploying state and federal tools to secure fair, compliant PBM contracts for pharmacies nationwide. Contact us to discuss ESI re‑contracting strategy, risk mitigation, and how to leverage new legislative rights in your negotiations.
Senior Associate
