AUGUSTA- A recently enacted Maine law that seeks a degree of regulation over the powerful pharmacy-benefits management industry has been put on hold pending the settlement of a legal challenge.

Pharmacy benefits managers contract with health insurers to, among other things, negotiate lower prices with drug manufacturers and retailers. Besides working for the insurance companies, the PBMs also commonly receive rebates and other awards from drug manufacturers for steering consumers toward particular medications.

The Maine law that went into effect in September 2003 required PBMs to pass all negotiated discounts on to their client insurance companies and to disclose to them the details of their deals with drug companies.

The original bill’s sponsor, Sen. Sharon A. Treat, D-Farmingdale, said in introducing the measure that it would “shine the light of day on practices that don’t meet ethical standards and cost consumers money.”

But in early September, the Pharmaceutical Care Management Association, which represents the industry, challenged the law in U.S. District Court in Bangor, claiming the measure violates state and federal trade statutes. The suit asserts that forced disclosure of negotiated deals between PBMs and drug companies reveals proprietary information and undermines competition.

The decision of Judge John Woodcock, announced Wednesday morning, scores a preliminary victory for the PBM industry and for health care consumers, according to PCMA president Mark Merritt. PBMs can save consumers as much as 53 percent off cash prices, he said in a conference call, and regulation such as Maine’s will only drive prices higher.

Granting of the preliminary injunction takes the law out of effect immediately until the larger court challenge is settled. That case is still in its early stages.

In the six months that the law has been in effect, no conflict of interest cases have been brought against PBMs doing business in Maine, according to Chuck Dow of the Maine Attorney General’s Office. Dow said the AG has not decided whether to appeal the injunction.