AZ HB4124

Pharmacy benefit managers (PBMs) must reimburse Arizona pharmacies at least the acquisition cost for covered drugs and adopt reimbursement formulas using National Average Drug Acquisition Costs with a claim payment error rate of no more than 2% per drug.

PBMs are prohibited from retaining manufacturer rebates; all rebates must be passed through to plan sponsors as lower premiums, reduced cost-sharing, or broader drug coverage.

PBMs must submit annual transparency reports by March 1 disclosing total rebates received, administrative fees, reimbursements to network pharmacies, and their complete corporate vertical integration structure.

The bill bans spread pricing (charging more than paid to pharmacies) and patient steering to pharmacies in which PBMs have ownership interest or control.

Establishes a Pharmacy Benefit Manager Monitoring Advisory Council with representatives from state agencies, pharmacists, and legislators, and creates an enforcement fund from collected violation penalties, effective December 31, 2026.