NCPA Sues PBMs

NCPA and the National Association of Chain Drug Stores (NACDS), along with nine pharmacy companies, have filed a lawsuit in federal court to block the merger of Express Scripts Inc. (ESI) and Medco Health Solutions (Medco).

On April 2, the FTC closed its eight month investigation by approving the ESI-Medco merger with no restrictions on the parties. NCPA/NACDS’ lawsuit is still positioned to try to stop this alliance which will leave patients and pharmacies vulnerable to significant competitive harm from a combined ESI-Medco.

NCPA’s lawsuit contends that a merged ESI-Medco will reduce access and service to patients; reduce competition for PBM services, particularly to large plan sponsors; reduce competition for specialty pharmaceutical services; and reduce competition in mail order services, allowing the joint entity to raise mail order prices and drive business to their own mail order pharmacies regardless of patient preference. The merged company will control a large share of the supply line for brand and generic prescription drugs, and thereby will have the ability to raise prices for plans and patients, and limit access to pharmacy patient care.

WHAT YOU CAN DO:

• Generously Support NCPA’s Legislative/Legal Defense Fund (LDF) by donating through the NCPA website.

• Notify NCPA of any joint business activities (i.e., ESI and Medco contacted you jointly or their activities indicated that they were working together) from July 21, 2011 to present. Please forward any information to Anne Lasinsky at: or call 703-600-1220

• Contact your State Attorney General Office and encourage them to join the lawsuit to protect patients and pharmacies in your state. The following is the case information for your reference: (National Association of Chain Drug Stores; National Community Pharmacists Association; et al. v. Express Scripts, Inc. and Medco Health Solutions, Inc., Case 2:12-cv-00395-CB-CRE, filed in the U.S. District Court for the Western District of Pennsylvania)

This is a fight for ALL of community pharmacy. When assessing your level of involvement, we know that you will consider the magnitude of the potential consequences of this merged entity on your patients and your business. We must pull out all the stops and stand together.

Four Independent Pharmacies Sue HHS and CMS for Violating Medicare Part D Law

Four members of the Association of Community Pharmacists Congressional Network (ACPCN) have sued the Department of Health and Human Services (HHS) and the Centers for Medicare and Medicaid Services (CMS). The lawsuit charges that CMS wrongfully permitted prescription drug plans (PDPs), run by Pharmacy Benefit Managers (PBMs), to create "preferred pharmacy networks". The ACPCN coordinated lawsuit seeks to prevent CMS from approving network schemes that allow select pharmacies to entice enrollees through economic incentives, including lower copayments, while denying competing pharmacies access to the same terms and conditions as required by the Medicare Part D prescription program law.

"The lockout of competing pharmacies and their patients accomplished by the design of these so-called preferred networks was never intended by Congress, which guaranteed through pro-competitive provisions that any willing pharmacy would have equal access to the terms and conditions of any Part D network contract." said John M Rector Legal Advisor, ACPCN.

Plaintiffs in the case, Farmville Discount Drug, Inc., East Carolina Pharmacy Care, Inc., Columbia Pharmacy, Inc. and Todd’s Pharmacy of Gates County, Inc., note that nothing in the Medicare Part D Statute or its legislative history allows for the operation of prescription drug plans that allow a "preferred" pharmacy to offer one set of low co-pay and co-insurance rates to enrollees while requiring other, non-preferred pharmacies to charge enrollees higher prices. The plaintiffs argue that this inclusion

of some, and exclusion of all others, not only harms patients but also puts the excluded pharmacies at a tremendous competitive disadvantage.

To assure pharmacy access to enrollees, Medicare Part D includes the ‘Any Willing Provider Law,’ which requires a prescription drug plan to permit the participation of any pharmacy that meets the terms and condition of the plan. Seven Medicare Part D big boxes "preferred" retailer networks have been offered since 2011, including the exclusionary plans of Humana-Wal-Mart, AARP, Aetna, CVS-Caremark and Rite-Aid. Independent pharmacies have been denied access to each of these "preferred networks."

"Residents in rural or metro areas could be forced to drive miles to the find the nearest preferred pharmacy to fill their prescriptions at the preferred price. This lawsuit was filed by independent pharmacies to preserve the right of their patients to fill prescriptions at the pharmacy of their choice and receive the same pricing they would by going to these retail giants," said Mike James, Vice-President of Government Affairs, ACPCN.

The design of these anti-competitive plans, in little more than a year, has driven 6.3 million of the 19.5 million Medicare D enrollees from their neighborhood pharmacy of choice and pharmacist services that they prefer and have used for years to pharmacies that they do not prefer. This landmark lawsuit is the first legal action by members of a national pharmacy trade association challenging the lawfulness of the establishment under Medicare Part D by HHS/CMS of the "preferred pharmacy" networks.

Federal Legislation

H.R. 3839: Titled the Drug Shortage Prevention Act of 2012, this proposed legislation seeks to address critical drug shortages.

H.R. 3847: Titled the Safety of Untested and New Devices, this legislation seeks to ensure that a medical device is not marketed based on a determination that the device is substantially equivalent to a predicate device that has been recalled, corrected, or removed from the market due to an intrinsic technology flaw or design.

H.R. 1946: Titled Preserving Our Hometown Independent Pharmacies Act, this bill seeks to foster continued safety and quality of care and a competitive marketplace by exempting independent pharmacies from the antitrust laws in their negotiations with health plans and health insurers.

H.R. 3859: Titled the Rural Hospital and Provider Equity Act of 2012, this bill seeks to protect and preserve access of Medicare beneficiaries in rural areas to health care providers under the Medicare program.