Becker’s Payer Issues – Online article  | October 13, 2025

On October 11, California Governor Gavin Newsom signed a new law designed to curb inflated drug pricing by pharmacy benefit managers (PBMs). The legislation marks a major step forward in holding PBMs accountable and protecting both patients and community pharmacies from unfair practices.

Ending PBM Spread Pricing

The new law directly targets “spread pricing.” This practice allows PBMs to charge health plans or insurers more than they actually pay pharmacies for prescriptions—pocketing the difference as profit.

Under the law, PBMs must now use a passthrough pricing model. This ensures costs align more closely with actual spending and prevents PBMs from inflating drug prices at the expense of patients and plan sponsors.

Protecting Independent Pharmacies

Beyond pricing transparency, the law also prohibits PBMs from excluding or limiting nonaffiliated pharmacies from dispensing medications. This provision is crucial for independent pharmacies that often face exclusion from PBM-controlled networks.

By removing these barriers, California is giving neighborhood pharmacies a fair shot at competing and continuing to serve patients who rely on their trusted care.

Lawmakers Speak Out

State Senator Scott Wiener, one of the bill’s authors, praised the legislation:

“This new law builds on the licensing framework we established earlier this year to begin holding PBMs accountable for abusive behavior. I’m grateful for Gov. Newsom’s leadership in fighting to ensure neighborhood pharmacies get a fair shot and that no family is ever forced to choose between lifesaving medications and putting food on the table.”

Why This Matters Nationwide

California’s move reflects a growing national trend. States across the country are taking action to rein in PBMs, demanding transparency, fairness, and accountability. For patients, these reforms mean fewer pricing games, more pharmacy options, and better access to lifesaving medications.

At RescueMeds, we strongly support measures like California’s. PBM spread pricing and unfair network practices harm patients every day—especially injured workers navigating workers’ compensation. Our mission is to remove barriers to care, ensure prescriptions are delivered quickly, and fight for a healthcare system that prioritizes patients over profits.

The Path Forward

California’s new law is a victory for patients, providers, and independent pharmacies. But it is also a reminder that more work remains. To truly protect patients nationwide, other states must follow California’s lead and pass their own PBM reforms.

RescueMeds will continue to advocate for policies that:

• End spread pricing and clawbacks

• Ensure fair reimbursement for independent pharmacies

• Protect patients from restricted pharmacy access

Because when PBMs play games with prescription pricing, patients lose. And that’s unacceptable.

Click here to see  California’s Senate Bill SB-41 Pharmacy benefits (2025-2026) in full