Overview
Launching a pharmacy benefit manager (PBM) from the ground up is no small feat—especially when it comes to PBM licensure requirements and regulatory compliance. For one newly established PBM, this process quickly became a major hurdle.
Having started operations in late 2024, the company had begun enrolling members in multiple states. However, even with a small number of covered lives, they faced a critical challenge: securing state licensure to remain compliant.
Specific Challenges
- State regulations that didn’t account for startup PBMs
- Lack of one-year financial history required for applications
- Strict system requirements for claims reporting—even with zero claims
- Limited internal resources to manage the licensure process
Solution
Referred to Penstock through an industry partner, the PBM sought expert support to streamline licensing across multiple states. Unlike traditional compliance projects, this engagement was driven by sales strategy, requiring licensing to move at the speed of new business deals.
Our team took a proactive approach, including:
- Regulatory Gap Analysis: Assessing existing regulations to identify compliance barriers unique to startup PBMs
- Direct Regulator Engagement: Working with state agencies to clarify licensing requirements and resolving ambiguities
- Custom Licensing Roadmap: Developing a structured, scalable approach to ensure efficient approvals
- Innovative Compliance Solutions: Overcoming financial and claims history limitations that were not designed for new PBMs
By proactively addressing these challenges, Penstock accelerated the licensing process, allowing the PBM to focus on growth without regulatory delays.
Client Success
With Penstock’s PBM compliance expertise, the company successfully secured the necessary licenses to operate—and is now positioned for long-term expansion.
Key Results and Benefits:
- $30k in Estimated Cost Savings: Avoided costly legal fees by choosing Penstock over traditional law firms
- 33% Faster Licensing Approvals: Cut initial licensure timelines by 3-4 weeks, accelerating speed to market and ensuring covered lives are compliant at the time of the effective date
- Streamlined Compliance Framework: Reduced administrative burden as the PBM scaled operations
- Trusted Regulatory Partnership: Continued expert guidance from Penstock into the future for additional state expansions and renewals
Now operating in multiple states, the PBM has a trusted compliance partner in Penstock, ensuring that regulatory hurdles never stand in the way of business growth. To experience similar efficiencies in your regulatory processes, schedule a ClearFile demo today.
