States Move to Split Pharmacies From Benefit Managers
Pharmacy chains and PBMs under common ownership may need to restructure as more states follow Tennessee and Arkansas.
Updated on Nov. 2, 2026 in Healthcare
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Should states bar companies from owning both pharmacies and pharmacy benefit managers?
Tennessee and Arkansas have enacted laws barring companies from owning both pharmacies and pharmacy benefit managers, and other states are reportedly poised to follow. The crackdown could force CVS to sell hundreds of its stores.
Why it matters
Pharmacy benefit managers negotiate drug prices on behalf of insurance plans, so vertical ownership of pharmacies and PBMs sits at the center of how drug costs flow to payers and patients. Republicans have increasingly backed breaking up these conglomerates, tracking President Donald Trump's populism and consumer frustration over the cost of living.
Drug prices fell nearly 3% in the year ending July 2026, the largest decline in more than half a century. A burgeoning crackdown could require CVS to sell off hundreds of its stores, though the full count remains unsettled.
The players
CVS Health
CVS Health operates a large national chain of retail pharmacies alongside its pharmacy benefit manager, making it a central target of efforts to separate pharmacy and PBM ownership.
Tennessee Governor Bill Lee
Bill Lee is the Republican governor of Tennessee who signed the state law barring companies from owning both pharmacies and pharmacy benefit managers.
Arkansas Governor Sarah Huckabee Sanders
Sarah Huckabee Sanders is the Republican governor of Arkansas who signed the state law barring companies from owning both pharmacies and pharmacy benefit managers.
President Donald Trump
Donald Trump is the current President of the United States, whose populist politics have been cited as shaping Republican support for breaking up pharmacy conglomerates.
The details
The new Tennessee and Arkansas laws bar companies from owning both pharmacies and pharmacy benefit managers, separating the two functions. Tennessee Governor Bill Lee and Arkansas Governor Sarah Huckabee Sanders signed the measures. For operators in pharmacy and healthcare distribution, the separation changes which firms can negotiate drug pricing and dispense through the same corporate structure.
Timeline
Drug prices fell nearly 3% in the year ending July 2026.
Article on the crackdown against pharmacy conglomerates was published November 1, 2026.
Market Landscape
Tennessee and Arkansas have now enacted laws separating pharmacy and pharmacy benefit manager ownership, setting a template other states are reportedly considering. Vertically integrated pharmacy conglomerates like CVS face the prospect of divesting part of their retail footprint if the approach spreads.
Operators in pharmacy, benefit management, and healthcare purchasing should track which additional states adopt separation laws and how they define covered ownership. Businesses that buy pharmacy services or contract with PBMs should review how any divestiture or restructuring could change pricing terms, and consult qualified counsel before acting.
The takeaway
Watch for the next wave of state legislation, since each new law expands the set of companies that must restructure. Operators in healthcare should model scenarios for pharmacy and PBM ownership changes and confirm their compliance position with qualified counsel.
Further reading
For context on how these ownership rules intersect with the broader industry, see our Healthcare coverage.
Source note: This article includes information reported by POLITICO.
Live Poll
Should states bar companies from owning both pharmacies and pharmacy benefit managers?
