Every CVS Pharmacy In Red State Might Close After Crackdown On Drug Middlemen

Last month, Arkansas Republican Gov. Sarah Huckabee Sanders signed a bill banning drug middlemen from holding permits for prescription drug sales in the state. Now, CVS might have to close its pharmacies there.

The new law, which will go into effect on January 1, 2026, revokes permits for pharmacies affiliated with pharmacy benefit managers (PBMs). The drug middlemen have been scrutinized by multiple states and even the federal government in recent years, as locally owned independent pharmacies say they are subject to the dictates of PBMs, which give an unfair advantage to large pharmacy corporations such as CVS.

CVS — which owns pharmacy benefits manager, Caremark Rx — said over the weekend that it is “looking at all available options to stay open and continue to serve Arkansans” after Gov. Sanders signed the crackdown on PBMs. Beginning in 2026, CVS must either close all of its 23 locations in Arkansas or change its PBM business model, the Northwest Arkansas Democrat Gazette reported.

“For far too long, drug middlemen called PBMs have taken advantage of lax regulations to abuse customers, inflate drug prices, and cut off access to critical medications. Not anymore,” said Sanders after signing House Bill 1150 into law.

The three largest PBMs in the country —  which are owned by CVS Health, Cigna, and UnitedHealth Group — manage nearly 80% of prescription drug claims for all Americans, according to the Federal Trade Commission. An FTC report published in January found that “the three major pharmacy benefit managers hiked costs for a wide range of lifesaving drugs, including medications to treat heart disease and cancer.”

CVS ripped the new Arkansas legislation after it was signed by the governor, calling it “bad policy” that “forces the closures” of its pharmacies.

“The Governor and legislature have chosen to pass HB 1150 which forces the closure of all CVS pharmacy operations by 1/1/26 — this includes CVS Pharmacy, CVS Specialty, and Omnicare,” a company spokesman said. “Our stores and pharmacies remain open, and our teams are continuing to serve patients and customers.”

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Arkansas Pharmacy Association Chief Executive Officer John Vinson, who supported the legislation, told the Northwest Arkansas Democrat Gazette that there are steps for CVS to take to continue operating its pharmacies in Arkansas, such as giving up its PBM license in the state.

“There are ways to do it … if they don’t, they’re choosing the conflict and the business model over customers,” Vinson said.

Independent pharmacy owners told The Daily Wire last year that PBMs have a direct negative effect on local pharmacies, often paying them lowball prices for filling prescriptions. With PBMs putting their hands on the scales of the prescription drug industry, patients are also directed toward pricier options and charged steep markups, according to The New York Times.

Other states, such as Oklahoma, Tennessee, and North Carolina, have moved to regulate PBMs and reel in their control over the prescription drug industry. At the federal level, President Donald Trump signed an executive order in April to improve transparency of “the direct and indirect compensation received by pharmacy benefit managers.”

Two bipartisan bills were reintroduced in Congress earlier this year to “combat the high cost of prescription drugs and provide greater transparency of pharmacy benefit managers (PBMs).”

This article has been updated to remove a mention of Walgreens since Walgreens does not own a PBM and is not affected by the new law. We regret the error.