ALEXANDRIA, Va. (Jan. 10, 2024) – The National Community Pharmacists Association today cheered a class action lawsuit against Express Scripts, alleging that the massive pharmacy benefit manager, one of the largest in the world, colluded with several smaller PBMs to rig reimbursement rates and shake down pharmacies for higher fees.
The lawsuit, filed by Berger Montague and several other law firms, claims that Express Scripts used its dominant market position to push rival PBMs to impose excessive back-end fees on pharmacies and then share the revenue with Express Scripts. Express Scripts announced one such arrangement in 2019 with Prime Therapeutics, a smaller PBM. NCPA warned then that the relationship would lead to unfavorable terms for community pharmacies.
“These two companies operating separately already exert tremendous downward pressure on independent pharmacies. By joining forces, they can put many out of business and steer their patients to larger competitors,” said NCPA CEO B. Douglas Hoey, pharmacist, MBA at the time. In a 2020 letter to state attorneys general, Hoey urged them to scrutinize the collaboration.
“We saw this coming three years ago,” said Hoey. “Their collaboration is collusive to enhance already one-sided negotiating leverage and fix reimbursement rates and related fees. Now, Express Scripts has the same kind of sweetheart deal with multiple PBMs and many more pharmacies are affected. The goal of these non-merger mergers was to create collusive and anticompetitive price fixing arrangements and the effects have been devastating to independent pharmacies. We applaud these NCPA members for taking on this issue on behalf of our industry.”
The plaintiffs in the case are Osterhaus Pharmacy, Inc., Cammack’s Pharmacies Inc., Jim’s Pharmacy and Home Health, Harbor Drug Co., Inc., and Valu Drugs Inc.
Founded in 1898, the National Community Pharmacists Association is the voice for the community pharmacist, representing over 19,400 pharmacies that employ nearly 240,000 individuals nationwide. Community pharmacies are rooted in the communities where they are located and are among America’s most accessible health care providers. To learn more, visit www.ncpa.org.