A political showdown between Louisiana Governor Jeff Landry and health care giant CVS dominated the closing days of the state’s legislative session this year, bringing the debate over pharmacy benefit managers (PBMs) into sharp focus.

At the heart of the clash was Landry’s push to curb the influence of PBMs. Landry urged lawmakers to prohibit PBMs from owning pharmacies in Louisiana, a move aimed at breaking up what he calls vertically integrated monopolies. In response, CVS launched a sweeping lobbying effort, warning customers by text message that the proposal could shutter more than 100 pharmacies statewide.

Although the proposal failed to advance, Louisiana officials have moved aggressively against CVS and other PBMs through contracts, lawsuits, and regulatory initiatives.

One of the clearest signs of shifting policy came when lawmakers stripped CVS Caremark of a lucrative 2026 contract to provide PBM services for the state employee health plan. Instead, most of the work was awarded to Liviniti, a Louisiana-based PBM.

Liviniti will manage prescription benefits for the majority of the 200 000 state plan members in a deal valued at $749 million, with the state paying $24 million in administrative fees. CVS subsidiary SilverScript retained only a portion of the work, covering certain retirees under a $399 million contract with $8 million in fees.

Commissioner of Administration Taylor Barras confirmed that the state rescinded its earlier request for proposals in consultation with the governor during the legislative session, before rebidding the work. He emphasized that the new contracts involve “nonvertically integrated PBMs,” reflecting policymakers’ growing skepticism of large national players.

The state has also taken CVS to court. Less than 2 weeks after session adjourned, Attorney General Liz Murrill filed 3 lawsuits targeting the company’s practices. One accuses CVS of misusing consumer data when sending political text messages. Two others allege that CVS’s integrated business model manipulates prices, stifles competition, and violates Louisiana’s Unfair Trade Practices Act.

Those lawsuits, now pending in federal court, contend CVS under-reimburses independent pharmacies while channeling profits internally. CVS has defended its model as one that improves affordability and access. “By combining health care delivery, pharmacy, health care benefits and pharmacy benefit management, we make it easier for people to have what they want the most: a connected care experience,” said spokesperson Amy Thibault.

The PBM debate raises critical questions for payers and health plans. Vertical integration allows conglomerates like CVS, UnitedHealthcare, and Cigna to control multiple segments of the drug supply chain, from benefit management to dispensing. Critics argue this structure creates conflicts of interest, limits pharmacy choice, and drives up costs through opaque pricing practices.

This spring, lawmakers passed a reform bill requiring more transparency around PBM pricing, enhancing regulatory oversight, and improving reimbursements for independent pharmacies. The state’s PBM Monitoring Advisory Council has reconvened to evaluate additional measures, with testimony from stakeholders such as the Mark Cuban Cost Plus Drug Company underscoring the urgency of reform.

The confrontation between Landry’s administration and CVS illustrates the growing scrutiny of PBMs nationwide. For payers and managed care stakeholders, the developments in Louisiana highlight the increasing likelihood of state-level interventions that could reshape coverage structures, contracting arrangements, and patient access to prescription drugs.

Whether lawmakers will pursue a ban on PBM vertical integration next session remains uncertain, but the pressure to rein in the industry is not easing.

Reference

Pfeil A. Inside the fight over drug prices as Louisiana leaders target CVS, other pharmacy middlemen. Nola.com September 26, 2025. Accessed September 29, 2025. https://www.nola.com/news/politics/louisiana-cvs-pbms-drug-prices/article_0fde2197-0ece-4906-817c-8396d14b8e94.html