Specialty Pharmacy Dispute With Express Scripts Rages Over Network Removal

In all disputes, there is always more than 1 side to every argument. This specifically applies to the recent Prime Aid V. Express Scripts lawsuit.

Prime Aid, the largest independent specialty pharmacy in New Jersey, is alleging that the powerful pharmacy benefit manager (PBM) Express Scripts removed the pharmacy from their network for pretextual reasons, for the sole purpose of directing clients to their own specialty pharmacy, Accredo. On the other hand, Express Scripts denies these claims, citing lack of adherence to the contract as the reason Prime Aid was removed.

Prime Aid had been contracting with the PBM since 2011, but was removed after the pharmacy failed to remove 7 claims for prescription drugs, and for paying a penalty to New Jersey to avoid disciplinary actions after a pharmacist improperly filled a prescription, according to Express Scripts.

The heart of this lawsuit is that the PBM owns its own mail-order pharmacy, a fact which Prime Aid’s attorney, Jonathan Swichar, believes is a driving factor of why the specialty pharmacy was removed from Express Scripts’ network. Swichar is an attorney for multiple pharmacies, some of which are facing similar issues with PBMs.

“We intend to establish that once independent pharmacies cross a certain level of revenue, they become a target of termination by Express Scripts based on the competition they pose to Express Scripts’ own pharmacies.” Swichar told Specialty Pharmacy Times in an interview. “Moreover, this is a consumer issue. In New Jersey, Prime Aid’s physical presence allowed it to provide personalized attention to specialty pharmacy patients. The patients receiving these medications require assistance in treatment compliance. Many suffer from severely compromised health conditions that cannot be adequately serviced by mail order.”

Swichar said that the reasons for termination in the Prime Aid case were pretextual, and should not have resulted in dismissal unless there were alternative motives involved. The specialty pharmacy’s attorney argues that this termination came soon after new, expensive hepatitis C virus (HCV) drugs came to the market that generated substantial revenue for Prime Aid.

“At that point, Express Scripts required that Prime Aid participate in a very extensive audit requiring the production of documents relating to approximately 30,000 prescriptions,” Swichar said. “Of the 30,000 prescriptions, Express Scripts said that they identified issues with 7 of them. All 7 related to 1 alleged issue, which was the failure to timely reverse a claim.”

This failure to reverse the claims in a timely manner was largely due to a delay in approval for patient co-pay assistance programs to obtain the HCV drugs, which resulted in the termination of their contract, Swichar said.

While Express Scripts could not comment directly on the pending litigation, a spokesperson did say that all pharmacies in their network are expected to adhere to their contracts to remain in good standing with the PBM, regardless of how perceivably small a contractual breech may be.

“If you think about why we are hired, it’s so clients can have a pharmacy network that we help design to fit their needs. It’s cost effective, it delivers quality care,” Express Scripts spokesperson Brian Henry told SPT. “A big part of that is to ensure that the pharmacies that are in the network are who they say they are, and fulfill the contract agreement they have with us. What clients expect of us is to do that.”

Regardless of the size of the pharmacy, they are expected to comply with the contract both they and Express Scripts signed. If they do not, the PBM will attempt to rectify the situation, and the pharmacy will be removed if the issue is not resolved, Henry told SPT.

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