AZ SB1225

Requires pharmacy benefit managers (PBMs) and third-party payors to reduce a patient's cost sharing (copayments, coinsurance, deductibles) at the point of sale by at least 100% of all rebates received for that prescription drug.

Prohibits PBMs and third-party payors from retaining any portion of drug rebates or price concessions as revenue.

Defines "rebates" broadly to include negotiated price concessions, price protection rebates, performance-based rebates, administration fees, and other manufacturer payments.

Applies to health plan contracts entered into, renewed, extended, or modified after December 31, 2026.