PBM Settles Rebate Scheme Charges With States

Express Scripts last week reached a $9.3 million settlement with 29 states resolving claims that it engaged in deceptive business practices by encouraging doctors to switch patients to different brand name drugs that would produce higher rebates for the giant PBM and were more expensive to plans and patients. As part of the settlement, the company is required to "significantly" change its business practices.The settlement is the third entered into in recent years by various groups of states and the country's largest PBMs aimed at cleaning up the industry. In February, Caremark agreed to pay $38.5 million and reform its business practices. In April 2004, Medco agreed to pay $29.3 million and end its malpractices.These settlements are not related to cases that certain PBMs have settled with the Department of Justice. In October 2006, Medco paid $155 million to settle civil fraud and kickback claims. In September 2005, AdvancePCS, now a Caremark subsidiary, resolved similar allegations with a $137.5 million payment. Both PBMs also were required to enter into extensive corporate compliance agreements with the government.

by the National Community Pharmacists Association