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AB 910

Criminal procedure: sentencing.

2025-2026 Regular Session Introduced by Mia Bonta

AB 910 requires PBMs to act as fiduciaries to health plans, pass 100% rebates to plans, ban spread pricing, and submit DMHC registrations, audits, and annual reports.

From committee: Do pass and re-refer to Com. on APPR. (Ayes 4. Noes 1.) (June 30). Re-referred to Com. on APPR.
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Bill Summary · AB 910

AB 910 (Bonta) — Pharmacy benefit management

Status: In committee; hearing postponed by committee (05/23/2025)
Introduced: February 19, 2025

Purpose / Intent

AB 910 seeks to increase regulatory oversight, transparency, and fiduciary accountability for pharmacy benefit managers (PBMs) that contract with California health care service plans, with the stated aim of ensuring plan dollars and manufacturer remuneration are passed through to health plans and to eliminate certain PBM profit practices such as spread pricing.

Key provisions

  • Fiduciary duty: Replaces PBMs’ existing “good faith and fair dealing” obligation with a statutory fiduciary duty to health care service plans; PBMs must perform contractual duties in accordance with state and federal law.
  • Remittance requirement: PBMs must remit 100% of specified rebates, fees, alternative discounts, and other remuneration received from manufacturers (or affiliates/subcontractors) to the contracting health care service plan. PBMs may not enter contracts that circumvent this requirement.
  • Registration / disclosure: Strengthens PBM registration with the Department of Managed Health Care (DMHC). Applicants must disclose the name, address, and relationship of any affiliated entity and any group purchasing organization (GPO) in which they have ownership, control, financial interest, or a contractual relationship.
  • Prohibition on spread pricing: PBMs, affiliated entities, and GPOs are prohibited from deriving income from spread pricing (charging a plan a higher contracted price than the amount paid to the pharmacy).
  • Inspection and audit: PBM compensation arrangements subject to these rules must be open to inspection and audit by the DMHC.
  • Annual reporting (starts Oct 1, 2026): PBMs must annually report to DMHC specified data including covered drugs dispensed at pharmacies, PBM revenue and expenses, contracts with health care service plans, scope of services provided to plans, and number of enrollees served. DMHC will compile and publish a report; underlying records (other than the compiled report) are exempt from public disclosure.
  • Contracting requirement for plans: Health care service plans that cover prescription drugs must require PBMs they contract with to comply with the bill’s registration and reporting requirements.
  • Enforcement and penalties: Willful violation by a health care service plan is a crime (creates a state-mandated local program). The bill makes legislative findings to justify any limitation on public access to certain records.

Definitions added/clarified

The bill defines terms including “affiliated entity,” “group purchasing organization,” “pharmacy benefit manager,” “rebates” (broadly defined to include many manufacturer payments and administrative fees), and “spread pricing.”

Who is affected

  • PBMs and their affiliates (including GPOs)
  • Health care service plans that contract with PBMs
  • Pharmacies (retail, mail-order, specialty)
  • Drug manufacturers and distributors
  • DMHC (new reporting, audit, and compilation responsibilities)

Timeline / procedural status

  • Introduced: Feb 19, 2025
  • Multiple committee amendments and referrals in March–April 2025 (Assembly Health; re-referred to Appropriations)
  • As of May 7, 2025: Set for first hearing; referred to Appropriations suspense file
  • As of May 23, 2025: Hearing postponed by committee

Potential impacts (high level)

  • Increased transparency of PBM finances and revenue flows to plans.
  • Possible alteration of PBM business models (loss of rebate retention and spread pricing revenue).
  • Effects on plan premiums, pharmacy reimbursement, and manufacturer contracting could follow but would depend on market responses.
  • Increased administrative and compliance obligations for PBMs and DMHC.

(This summary is based on the text and legislative digest of AB 910 as amended and the bill’s legislative activity through 05/23/2025.)

Compiled from official sources — confirm details with the bill’s official record.

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