Hiring a PBM: How Smaller Companies Can Become More Attractive to Pharmacy Benefit Managers

Hiring a Pharmacy Benefit Manager (PBM) is not only about deciding which vendor is attractive to your company. 

It also works the other way around.

PBMs decide which opportunities are worth pursuing. They look at company size, network requirements, claims data, contract economics, implementation risk, pharmacy benefit needs, reporting expectations, timeline, and whether the opportunity fits their business model.

This is not a step-by-step guide, because every business is different and every PBM evaluates potential clients on a case-by-case basis. But keeping the concepts below in mind can make your search for PBM services easier. The more prepared your company is, the more attractive it may become to the PBMs best suited to serve it.

For smaller and midsized companies that have reached the point where PBM services make sense, this is an important shift in thinking. You are not only shopping for a PBM. In many cases, you are also trying to become the kind of opportunity a qualified PBM wants to serve.

That does not mean smaller companies lack leverage. It means they need to use a different kind of leverage.

Large employers may attract PBMs because of scale. Smaller companies can attract PBMs by being organized, realistic, data-ready, flexible, and clear about what they need. They can also improve their options by being open to alternative PBMs that may fit their size, goals, and service expectations better than the largest market names.

Hiring a PBM is easier when the company understands what PBMs are looking for.

Why PBMs Evaluate Potential Clients Too

A PBM relationship requires real operational work.

Before a PBM agrees to compete for or serve a company, it may need to evaluate pricing, rebates, network needs, formulary expectations, specialty pharmacy exposure, reporting requirements, implementation timing, member disruption, audit rights, service guarantees, and account management needs.

That evaluation takes time.

A PBM may need pricing analysts, sales leaders, clinical experts, implementation teams, legal reviewers, rebate specialists, network experts, and account management input before it can decide whether the opportunity is a good fit.

For a smaller company, the PBM may ask a basic question: does the opportunity justify the effort and ongoing service requirements?

That question is not unfair. It is how vendors protect their resources and make sure they can support clients responsibly.

The goal for the company is to make the answer easier.

A company that provides clear data, realistic goals, and a well-organized procurement process becomes easier to evaluate. That can make the opportunity more attractive.

1. Know Whether PBM Services Actually Make Sense Yet

The first step in hiring a PBM is making sure the company is ready for PBM services.

Not every smaller company needs a direct PBM relationship at the same stage. Some companies may still be better served through bundled insurance arrangements, broker-managed solutions, coalition arrangements, or other pharmacy benefit structures. Others may have reached a point where direct PBM evaluation makes sense because of size, pharmacy spend, self-funded status, specialty pharmacy exposure, or a need for more control.

The company should understand why it is looking for PBM services now.

Common reasons include:

• Pharmacy spend has become large enough to require closer management
• The company wants more visibility into rebates and pricing
• Specialty pharmacy costs are increasing
• The current arrangement lacks reporting or audit clarity
• The company wants more control over plan design
• Member access or service issues need improvement
• The organization is moving toward or already operating a self-funded model
• Leadership wants a more competitive vendor evaluation

A PBM will take the opportunity more seriously when the company can explain why the search is happening and what problem it is trying to solve.

2. Organize Your Claims Data Before Asking PBMs to Respond

Claims data is one of the most important pieces of information a company can prepare before hiring a PBM.

PBMs need to understand the current pharmacy benefit. That includes total drug spend, prescription volume, brand and generic utilization, specialty pharmacy exposure, retail versus mail use, member cost share, plan-paid amounts, high-cost claims, and utilization trends.

Without that information, PBMs may have to price with assumptions. Assumptions create risk.

Risk can make an opportunity less attractive.

A smaller company can improve its position by gathering clean, recent, usable pharmacy benefits data before asking PBMs to evaluate the opportunity.

The company does not need to have a perfect analysis ready. But it should know where the data is, who can provide it, what time period it covers, and whether it includes enough detail to support vendor comparison.

Good claims data tells PBMs that the company is serious and prepared.

3. Be Clear About Covered Lives and Contract Size

PBMs will also look at scale.

That includes covered lives, prescription volume, expected claims activity, annual pharmacy spend, and potential contract value.

This does not mean only large companies can attract PBMs. It means PBMs need to understand the economics of the relationship.

A smaller company should be clear about:

• Number of covered employees
• Number of covered members
• Annual pharmacy spend
• Current prescription volume
• Specialty pharmacy spend
• Expected growth
• Contract term expectations
• Whether the company is evaluating alone or through a coalition

A company that is small but growing may still be attractive. A company with meaningful specialty pharmacy needs may require more serious PBM attention. A company participating through a coalition may create scale that changes the economics.

The important point is transparency.

A PBM should not have to guess whether the opportunity is large enough to support the required services.

4. Show That Your Goals Are Realistic

Smaller companies sometimes weaken their own procurement process by asking for every possible feature, guarantee, report, customization, and pricing term.

That can make the opportunity look unfocused or unrealistic.

A better approach is to define priorities.

For example, a company might decide that its most important goals are:

• Better net cost visibility
• More transparent rebate handling
• Stronger specialty pharmacy management
• Improved reporting
• Better member service
• Lower disruption during implementation
• Clearer audit rights
• More predictable administrative fees

A company does not need to solve every issue at once.

PBMs are more likely to engage seriously when the requestor can distinguish must-haves from nice-to-haves. This helps the PBM understand what the company actually values and whether the PBM can support those goals.

Being realistic does not mean accepting weak terms.

It means knowing which terms matter most.

5. Be Open to Alternative PBMs

When smaller companies think about hiring a PBM, they may first think of the largest and most recognizable PBMs in the market.

That is understandable.

But bigger is not always the best fit.

Smaller companies should be open to alternative PBMs, regional PBMs, transparent pricing models, specialty-focused options, or vendors with service models designed for smaller or midsized clients.

An alternative PBM may offer a stronger fit because it may be more interested in the account size, more flexible in service approach, more transparent in pricing structure, or better aligned with the company’s need for support.

This is not about assuming large PBMs are bad or smaller PBMs are better.

It is about fit.

A company should ask: which PBM is built to serve an organization like ours?

That question often leads to a better procurement process.

6. Understand That Customization Has a Cost

Customization can be valuable, but it is not free.

A company may want custom reporting, custom scorecards, a unique formulary approach, special network requirements, tailored member materials, dedicated account support, unusual audit terms, specific data feeds, or specialized implementation support.

Some of those requests may be reasonable.

But each one adds complexity.

For smaller companies, too much customization can make the opportunity harder for PBMs to support economically. A PBM may decide that the account requires too much manual work relative to the contract size.

The better strategy is to ask for customization only where it matters.

A company should separate standard needs from true business requirements. If a standard report works, use it. If a standard implementation path is sufficient, avoid unnecessary custom workflows. If a standard formulary model fits the company’s goals, do not overcomplicate it.

The most attractive smaller companies are not the ones that ask for the most.

They are the ones that know what they need.

7. Prepare for Implementation Before Selection

PBMs care about implementation risk.

A company that looks unprepared for implementation may be less attractive, even if the opportunity itself is commercially reasonable.

Implementation may require eligibility files, benefit plan details, formulary decisions, network decisions, member communications, data transfers, testing, payroll or HR coordination, internal approvals, and clear deadlines.

A company can make itself more attractive by showing that it understands the work required.

Before hiring a PBM, the company should know:

• Who will own the implementation internally
• What data will need to be transferred
• Who controls current pharmacy benefit information
• What member communication support is needed
• Whether leadership can make timely decisions
• Whether the timeline is realistic
• What disruption concerns need to be managed

8. Make Reporting and Audit Expectations Clear

Reporting and audit rights are important in PBM relationships.

But they should be clearly defined.

A smaller company may want visibility into claims, rebates, guarantees, pharmacy network performance, specialty pharmacy trends, member utilization, and administrative fees. Those are legitimate concerns. However, vague expectations such as “full transparency” or “complete reporting” may not help PBMs understand what is actually required.

Better questions include:

• What reports are needed monthly, quarterly, or annually?
• Does the company need claim-level reporting?
• What rebate reporting is expected?
• What guarantees need to be tracked?
• What audit rights are important?
• Who will review the reports?
• What decisions will the reporting support?

When reporting and audit expectations are specific, PBMs can evaluate them more easily.

That improves the quality of the response and reduces the chance of confusion later.

9. Be Clear About Formulary and Member Disruption Tolerance

Formulary decisions affect cost, rebates, clinical strategy, and member experience.

A company that is hiring a PBM should think carefully about how much disruption it can tolerate. A more aggressive formulary may improve cost management, but it may create member disruption. A less disruptive formulary may be easier for employees but may reduce some savings opportunities.

There is no single right answer.

The company should know its own position.

PBMs may ask:

• Is the company willing to consider formulary exclusions?
• How sensitive is leadership to member disruption?
• Are certain drug classes especially important?
• Does the company want stronger clinical management?
• How will employee communication be handled?
• How much disruption is acceptable during transition?

A company that can answer these questions is easier to serve.

It also gets better PBM proposals.

10. Make the Opportunity Easy to Understand

A smaller company can make itself more attractive by presenting the opportunity clearly.

That means PBMs should be able to understand the company’s size, current arrangement, pharmacy spend, goals, timeline, decision process, data availability, implementation expectations, and must-have requirements without digging through a confusing document.

A clear opportunity profile helps PBMs decide whether they are a fit.

It also shows professionalism.

The company does not need to sound like a Fortune 100 procurement department. It simply needs to show that the opportunity is real, organized, and worth serious consideration.

In practice, that means preparing:

• A short summary of the company and covered population
• Current pharmacy benefit structure
• Claims and spend data
• Key pain points
• Primary goals
• Timeline
• Decision makers
• Data availability
• Required services
• Preferred pricing approach
• Reporting and audit expectations

This kind of preparation can make a smaller company more attractive than a larger company with a disorganized process.

How PfRs Can Help Smaller Companies Explore PBM Services

Proposals for Requestors (PfRs) offer a structured alternative for companies exploring PBM services.

A PfR is a vendor initiated procurement method made available through a controlled online marketplace after access requirements are met. It is structured using standardized templates and represents a vendor’s available offering. It is not public sales collateral. It is not buyer initiated. It is not tailored to one specific requestor.

For smaller companies, this structure can be useful.

A traditional RFP often asks PBMs to decide whether the company is worth a custom response before the company has seen many available options. That can create friction, especially when the company is smaller, less experienced with PBM procurement, or still organizing its requirements.

PfRs change the starting point.

Because vendor initiated offerings are already available to qualified requestors, companies can discover and compare structured PBM offerings earlier. They can see which types of PBMs may fit their needs before asking for deeper custom work.

This can be especially helpful for smaller companies that should be open to alternative PBMs.

Instead of assuming the largest vendors are the only serious options, the company can evaluate structured offerings from PBMs that may be better aligned with its size, goals, pricing preferences, service expectations, and reporting needs.

PfRs do not eliminate the need for careful review. Hiring a PBM may still require consultant input, legal review, data analysis, negotiation, and buyer-specific follow-up.

But PfRs can lower the friction of early discovery.

They help companies compare available options before turning the process into a long custom RFP. They also help PBMs participate in early marketplace discovery without deciding whether every smaller company is worth a full custom response from the start.

That is useful for both sides.

Hiring a PBM Means Becoming a Better Buyer

Smaller companies can absolutely become attractive PBM opportunities.

But they need to approach the process with discipline.

They should organize their data, define their goals, understand their scale, clarify their must-haves, avoid unnecessary customization, prepare for implementation, and stay open to PBMs that fit their actual needs.

Hiring a PBM is not only about asking vendors to prove themselves.

It is also about showing vendors that your company is prepared, serious, and commercially realistic.

That may sound blunt, but it is good news.

Smaller companies cannot always compete on size. But they can compete on clarity.

A clear, organized, data-ready company is easier for PBMs to evaluate and easier for PBMs to serve.That improves the chance of attracting better-fit options, receiving stronger responses, and building a PBM relationship that supports the company’s pharmacy benefit goals.

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Rapid Request is building a structured marketplace approach to PBM procurement, designed to help qualified requestors discover vendor initiated PfRs and compare PBM offerings with less early-stage friction.

To understand why this matters, read more about how PBMs judge RFPs before deciding whether to bid.