Five retail pharmacies are suing Express Scripts for allegedly using its pharmacy benefit management business to pilfer billions of dollars of high-profit prescriptions and patients for its mail order pharmacy.
In a putative class action (PDF) filed Monday in Missouri federal court, retail pharmacies from across the country alleged that St. Louis-based Express Scripts forcibly transferred retail customers with high-profit, brand-name drug prescriptions to its mail order business without customer or pharmacy permission, breaching its PBM contracts and siphoning business from independent companies.
Express Scripts' mail order business has ballooned from less than $8 billion and 41.8 million prescriptions in 2009 to $37.6 billion and 141.2 million prescriptions in 2013, and the five pharmacies claim this is a direct result of their “prescription slamming.”
Most pharmacies have to contract with pharmacy benefit managers such as Express Scripts—the largest PBM in the country—to receive payment from private, employer-run and government insurance plans, since insurers generally don't contract with individual pharmacies.
Under the PBM contracts, the pharmacies hand over customers' names, addresses and prescription information, most of which is used to approve the transactions. But the pharmacies say the addresses are unnecessary, and they accuse Express Scripts of using refill and prescription information to forcibly transfer the highest profit, brand-name drug prescriptions to its mail order business.
“Express Scripts' purpose is not to benefit patients or insurers who ultimately pay for patients' prescriptions,” the complaint said. “Indeed, there is no benefit guaranteed for anyone other than Express Scripts when patients are required to obtain their refills from Express Scripts rather than plaintiffs.”
Last month, Express Scripts revealed that its second-quarter profit rose by 21% although its PBM business shrank by approximately 2% since last year. All in all, it processed 315.3 million prescription drug claims during the second quarter and its earnings hit $720.7 million, thanks in part to cost cutting and better drug discounts.
The company is also in the middle of a high stakes spat with one of its largest customers, Anthem, with dueling lawsuits over their drug pricing agreement.
The pharmacies suing Express Scripts on Monday are Trone Health Services, Reddish Pharmacy, Jabos Pharmacy, Oak Tree Pharmacy, Amrut Jal.
Express Scripts declined to comment on the pharmacies' lawsuit, but said it would vigorously defend itself.
