http://www.benefitspro.com/2018/02/26/pharmacy-benefits-managers-in-crosshairs-of-latest
They’d been out of the fight over the widespread use and abuse of opioids, but that could be about to change. Pharmacy benefit managers are being targeted by a lawsuit filed by Webb County, in South Texas, charging that PBMs enabled the opioid crisis and profited from the sale of the drugs that fueled it, according to a lawyer who represents the county.
Stat News reports that not only does this suit, filed in January, target PBMs, but in being rolled over into a larger that aggregates claims from cities and states across the country, it could also open up PBMs across the country to potential settlements as well as court orders meant to change the way the drug industry operates.
PBMs, the financial middlemen that determine which drugs are available and how much they’ll cost patients out of pocket, provide little transparency on how they make those determinations. The Webb County lawsuit is thought by its attorneys to be the first in the country to name PBMs as defendants in a municipal opioid lawsuit.
While some experts say that because PBMs aren’t publicly visible in their role, that could make it tough to prove liability for the overdose deaths and other consequences of the crisis.
Related: How can brokers help clients address the opioid epidemic?
“They are far more removed than manufacturers and distributors,” Jodi Avergun, a former chief of staff of the Drug Enforcement Administration and now a defense lawyer with Cadwalader, Wickersham & Taft, is quoted saying in the report. Avergun adds, “PBMs play a less significant role and one that’s harder to ascribe liability to under traditional tort principles.”
But that’s not the only expert opinion on the subject; other experts believe that legal discovery could be especially damaging for PBMs, since they hold records on the number of opioids dispensed in communities hit with huge increases in overdoses.
“It’s hard for these companies to [argue] that in certain locales the volume of pills was for a legitimate medical purpose,” Rebecca Haffajee, a professor of health management and policy at the University of Michigan School of Public Health, is quoted saying in the report. She adds, “The paper trail of prescriptions makes it more compelling, and those records should be disclosable.”
Joanne Cicala, a lawyer who represents Webb County, says in the report that PBMs enabled the opioid crisis and profited from the sale of the drugs that fueled it. She’s quoted saying, “We see them as an absolutely essential part of this scheme. They made sure these drugs were dispensed and they controlled their flow out into the communities.”
According to the report, the county’s suit includes claims against three PBMs that control most of the U.S. market: Express Scripts, CVS Health, and OptumRx. In addition, it names two smaller companies that also operate in South Texas, Prime Therapeutics and Navitus Health Solutions.
The suit also includes fraud, conspiracy, and racketeering charges against major drug manufacturers and wholesale distributors, which is common to many other complaints filed across the country. However, Webb County’s case stands out thanks to its legal claims and language directed at PBMs, entities the suit calls “the gatekeepers to the vast majority of opioid prescriptions filled in the United States.”
The PBMs aren’t going down without a fight, however. The report cites an e-mailed statement from Jennifer Luddy, a spokeswoman for Express Scripts, saying that the allegations in the case are without merit. “We plan to defend ourselves vigorously,” the statement says. In addition, CVS Health, Prime Therapeutics and Navitus Health Solutions all were quoted in the report saying that charges were baseless or defending their practices.
I have been talking about this for several months… I knew at some point that the PBM’s would be pursued for “damages” for paying for all those opiates that are part of the FABRICATED OPIATE CRISIS.
There are three major PBM’s that control some 80%+ of that market place
Then there are three major drug wholesalers that control some 80%+ of that market place
Then there are a handful of pharmas that control the high majority of the legal prescription opiate production
And all of these entities being sued have DEEP POCKETS
The PBM’s work – hired by – insurance companies and self-funded large employers whose insurance is self funded.. Where the “insurance company or PBM” is just a hired entity to pay out the employer’s money and adjudicate healthcare claims for the employer’s employees and family. Reportedly, ERISA type programs are about 50% of “health insurance” being provided to employees. These companies rely on these insurance companies/PBM’s to establish protocols as to what services/medication should be paid for and recommend other limits. Typically, the employer will accept the recommendations, because few have the internal expertise to manage this… this is why they hire these companies … they are the ones who are suppose to be experts in cost controls in this area.
Could we expect to see lawsuits by large ERISA companies towards their insurance/PBM administrators in the not so distance future. Anthem is already suing Express Script over alleged not “sharing” rebates from the pharma ? https://www.washingtonpost.com/news/wonk/wp/2016/03/21/anthem-sues-express-scripts-over-prescription-drug-pricing
Filed under: General Problems
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